BorgWarner (NYSE:BWA) Stock Price Down 5.1% - Should You Sell?

Key Points

• BorgWarner's stock price has dropped by 5.1% to around $42.15, with trading volume decreasing 76% from the average daily volume.
• Analysts have mixed views, with JPMorgan raising their price target to $45.00 and Zacks upgrading the stock to a "strong-buy," while Bank of America downgraded it to "neutral."
• The company has announced a quarterly dividend increase from $0.11 to $0.17 per share, alongside a $1 billion stock repurchase program indicating confidence in its stock valuation.

BorgWarner Inc. (NYSE:BWA - Get Free Report) dropped 5.1% during mid-day trading on Tuesday . The stock traded as low as $42.10 and last traded at $42.15. Approximately 664,298 shares changed hands during trading, a decline of 76% from the average daily volume of 2,737,381 shares. The stock had previously closed at $44.41.

Wall Street Analysts Forecast Growth

BWA has been the topic of several research reports. JPMorgan Chase & Co. upped their price objective on shares of BorgWarner from $43.00 to $45.00 and gave the company an "overweight" rating in a report on Monday, August 4th. Zacks Research upgraded shares of BorgWarner from a "hold" rating to a "strong-buy" rating in a report on Friday, September 12th. Weiss Ratings reiterated a "hold (c)" rating on shares of BorgWarner in a report on Saturday, September 27th. Bank of America lowered shares of BorgWarner from a "buy" rating to a "neutral" rating and raised their price objective for the company from $41.00 to $46.00 in a report on Wednesday, September 10th. Finally, UBS Group raised their price objective on shares of BorgWarner from $43.00 to $46.00 and gave the company a "neutral" rating in a report on Monday. Two research analysts have rated the stock with a Strong Buy rating, ten have issued a Buy rating and six have given a Hold rating to the company's stock. Based on data from MarketBeat, the stock has a consensus rating of "Moderate Buy" and a consensus price target of $43.36.

BorgWarner Trading Down 5.9%

The company has a market cap of $9.04 billion, a price-to-earnings ratio of 44.50, a P/E/G ratio of 1.47 and a beta of 1.09. The company has a current ratio of 2.02, a quick ratio of 1.66 and a debt-to-equity ratio of 0.64. The firm's 50-day moving average price is $42.08 and its 200 day moving average price is $35.20.

BorgWarner (NYSE:BWA - Get Free Report) last announced its quarterly earnings data on Thursday, July 31st. The auto parts company reported $1.21 EPS for the quarter, topping the consensus estimate of $1.06 by $0.15. The company had revenue of $3.64 billion during the quarter, compared to the consensus estimate of $3.56 billion. BorgWarner had a net margin of 1.50% and a return on equity of 16.17%. The company's quarterly revenue was up 1.0% on a year-over-year basis. During the same quarter last year, the firm posted $1.19 EPS. BorgWarner has set its FY 2025 guidance at 4.450-4.65 EPS. As a group, equities analysts expect that BorgWarner Inc. will post 4.28 EPS for the current year.

BorgWarner Increases Dividend

The business also recently disclosed a quarterly dividend, which was paid on Monday, September 15th. Stockholders of record on Tuesday, September 2nd were given a dividend of $0.17 per share. This is a positive change from BorgWarner's previous quarterly dividend of $0.11. The ex-dividend date of this dividend was Tuesday, September 2nd. This represents a $0.68 annualized dividend and a dividend yield of 1.6%. BorgWarner's payout ratio is 72.34%.

BorgWarner announced that its Board of Directors has approved a stock repurchase program on Thursday, July 31st that authorizes the company to buyback $1.00 billion in shares. This buyback authorization authorizes the auto parts company to buy up to 13.2% of its shares through open market purchases. Shares buyback programs are often an indication that the company's leadership believes its stock is undervalued.

Insider Buying and Selling at BorgWarner

In related news, VP Stefan Demmerle sold 5,000 shares of the company's stock in a transaction dated Wednesday, August 13th. The shares were sold at an average price of $40.50, for a total value of $202,500.00. Following the sale, the vice president owned 229,040 shares in the company, valued at $9,276,120. This represents a 2.14% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available at this link. Also, VP Isabelle Mckenzie sold 2,500 shares of the company's stock in a transaction dated Tuesday, August 12th. The stock was sold at an average price of $40.01, for a total transaction of $100,025.00. Following the completion of the sale, the vice president owned 55,945 shares in the company, valued at $2,238,359.45. This represents a 4.28% decrease in their position. The disclosure for this sale can be found here. In the last 90 days, insiders sold 31,272 shares of company stock worth $1,263,318. 0.63% of the stock is owned by corporate insiders.

Institutional Inflows and Outflows

A number of institutional investors have recently bought and sold shares of the business. GAMMA Investing LLC increased its holdings in BorgWarner by 1,822.6% during the first quarter. GAMMA Investing LLC now owns 99,244 shares of the auto parts company's stock worth $2,843,000 after buying an additional 94,082 shares during the last quarter. UMB Bank n.a. lifted its stake in BorgWarner by 97.2% in the first quarter. UMB Bank n.a. now owns 1,757 shares of the auto parts company's stock valued at $50,000 after purchasing an additional 866 shares during the last quarter. CHICAGO TRUST Co NA lifted its stake in BorgWarner by 26.4% in the first quarter. CHICAGO TRUST Co NA now owns 51,381 shares of the auto parts company's stock valued at $1,472,000 after purchasing an additional 10,716 shares during the last quarter. Farther Finance Advisors LLC increased its holdings in BorgWarner by 26.1% in the 1st quarter. Farther Finance Advisors LLC now owns 1,965 shares of the auto parts company's stock worth $56,000 after acquiring an additional 407 shares during the last quarter. Finally, Tounjian Advisory Partners LLC purchased a new stake in BorgWarner in the 1st quarter worth about $1,476,000. Institutional investors own 95.67% of the company's stock.

About BorgWarner

BorgWarner Inc, together with its subsidiaries, provides solutions for combustion, hybrid, and electric vehicles worldwide. It offers turbochargers, eBoosters, eTurbos, timing systems, emissions systems, thermal systems, gasoline ignition technology, smart remote actuators, powertrain sensors, cabin heaters, battery modules and systems, battery heaters, and battery charging.

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