Cubist Systematic Strategies LLC Makes New Investment in BorgWarner Inc. $BWA

Key Points

• Cubist Systematic Strategies LLC acquired a new position in BorgWarner, purchasing 575,498 shares valued at approximately $16.5 million, representing about 0.26% of the company at the end of Q1.
• BorgWarner's Board of Directors approved a $1 billion share buyback program, allowing the company to repurchase up to 13.2% of its stock, a potential indicator of management's belief in the stock's undervaluation.
• The company recently increased its quarterly dividend from $0.11 to $0.17, marking an annualized yield of 1.6%, with the dividend set to be paid on September 15th.

Cubist Systematic Strategies LLC acquired a new stake in BorgWarner Inc. (NYSE:BWA - Free Report) during the first quarter, according to its most recent disclosure with the SEC. The institutional investor acquired 575,498 shares of the auto parts company's stock, valued at approximately $16,488,000. Cubist Systematic Strategies LLC owned about 0.26% of BorgWarner as of its most recent filing with the SEC.

A number of other institutional investors also recently modified their holdings of BWA. New York State Teachers Retirement System lifted its position in shares of BorgWarner by 3.8% during the 1st quarter. New York State Teachers Retirement System now owns 219,180 shares of the auto parts company's stock valued at $6,280,000 after acquiring an additional 7,977 shares during the period. Avantax Advisory Services Inc. lifted its position in shares of BorgWarner by 13.3% during the 1st quarter. Avantax Advisory Services Inc. now owns 13,258 shares of the auto parts company's stock valued at $380,000 after acquiring an additional 1,555 shares during the period. Sage Rhino Capital LLC acquired a new position in shares of BorgWarner during the 1st quarter valued at $235,000. Brown Advisory Inc. acquired a new position in shares of BorgWarner during the 1st quarter valued at $522,000. Finally, Alpha Omega Wealth Management LLC lifted its position in shares of BorgWarner by 59.8% during the 1st quarter. Alpha Omega Wealth Management LLC now owns 25,190 shares of the auto parts company's stock valued at $722,000 after acquiring an additional 9,427 shares during the period. 95.67% of the stock is owned by institutional investors.

Insider Activity at BorgWarner

In related news, VP Stefan Demmerle sold 5,000 shares of BorgWarner stock in a transaction on Wednesday, August 13th. The shares were sold at an average price of $40.50, for a total value of $202,500.00. Following the transaction, the vice president directly owned 229,040 shares of the company's stock, valued at $9,276,120. The trade was a 2.14% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. Also, VP Isabelle Mckenzie sold 2,500 shares of BorgWarner stock in a transaction on 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 transaction, the vice president directly owned 55,945 shares in the company, valued at approximately $2,238,359.45. The trade was a 4.28% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders have sold 31,272 shares of company stock valued at $1,263,318 over the last three months. 0.63% of the stock is owned by corporate insiders.

Analyst Upgrades and Downgrades

Several research analysts have weighed in on the stock. Evercore ISI upped their price objective on shares of BorgWarner from $38.00 to $42.00 and gave the stock an "outperform" rating in a report on Monday, August 4th. UBS Group upped their price objective on shares of BorgWarner from $35.00 to $38.00 and gave the stock a "neutral" rating in a report on Monday, July 14th. Wall Street Zen upgraded shares of BorgWarner from a "buy" rating to a "strong-buy" rating in a report on Saturday, July 12th. Piper Sandler upped their price objective on shares of BorgWarner from $37.00 to $44.00 and gave the stock an "overweight" rating in a report on Friday, August 1st. Finally, Baird R W upgraded shares of BorgWarner from a "hold" rating to a "strong-buy" rating in a research note on Wednesday. One research analyst has rated the stock with a Strong Buy rating, eleven have given a Buy rating and five have assigned a Hold rating to the stock. Based on data from MarketBeat, the company currently has a consensus rating of "Moderate Buy" and an average target price of $40.57.

BorgWarner Stock Performance

BWA traded up $0.83 during trading on Thursday, hitting $43.82. 2,218,734 shares of the company traded hands, compared to its average volume of 2,829,966. The firm has a market cap of $9.48 billion, a P/E ratio of 46.61, a price-to-earnings-growth ratio of 1.29 and a beta of 1.09. The stock's fifty day moving average is $38.05 and its 200 day moving average is $32.79. The company has a quick ratio of 1.66, a current ratio of 2.02 and a debt-to-equity ratio of 0.64. BorgWarner Inc. has a one year low of $24.40 and a one year high of $43.85.

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

BorgWarner announced that its Board of Directors has approved a share buyback plan on Thursday, July 31st that allows the company to buyback $1.00 billion in outstanding shares. This buyback authorization allows the auto parts company to reacquire up to 13.2% of its stock through open market purchases. Stock buyback plans are often an indication that the company's management believes its stock is undervalued.

BorgWarner Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Monday, September 15th. Investors of record on Tuesday, September 2nd will be paid a $0.17 dividend. This is an increase from BorgWarner's previous quarterly dividend of $0.11. This represents a $0.68 dividend on an annualized basis and a yield of 1.6%. The ex-dividend date of this dividend is Tuesday, September 2nd. BorgWarner's payout ratio is 46.81%.

BorgWarner Profile

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.