BorgWarner BWA is slated to release first-quarter 2023 results on May 4 before market open. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings per share and revenues is pegged at $1.13 and $4.19 billion, respectively.
For the first quarter, the consensus estimate for BWA’s earnings per share has moved north by a cent in the past seven days. Its bottom-line estimates imply a rise of 7.62% from the year-ago reported number. The Zacks Consensus Estimate for its quarterly revenues suggests a year-over-year increase of 8.22%. Over the trailing four quarters, BWA surpassed earnings estimates on all occasions, the average surprise being 24.02%. This is depicted in the graph below:
BorgWarner Inc. Price and EPS Surprise
BorgWarner Inc. price-eps-surprise | BorgWarner Inc. Quote
In the fourth quarter of 2022, BWA reported adjusted earnings per share of $1.26, up from $1.06 recorded in the prior-year quarter. It also surpassed the consensus metric of $1.04. Higher-than-anticipated revenues from e-Propulsion & Drivetrain, Fuel Systems and Aftermarket segments resulted in the outperformance.
The company reported net sales of $4,108 million, outpacing the Zacks Consensus Estimate of $3,892 million. The top line also moved up 12.4% year over year.
Our proven model predicts an earnings beat for the original equipment manufacturer for the quarter to be reported as it has the right combination of the two key ingredients. A combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Earnings ESP: BWA has an Earnings ESP of +2.03%. This is because the Most Accurate Estimate is pegged 2 cents higher than the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: It currently carries a Zacks Rank #3.
Things to Note
BorgWarner’s Charging Forward project is likely to benefit from soaring EV popularity. The buyout of Santroll's light vehicle eMotor business has further bolstered BorgWarner's scale in eMotor product leadership as well as enhanced manufacturing capabilities. The buyout of Rhombus Energy complements BorgWarner’s existing European charging footprint and expands the firm’s portfolio in North America. BorgWarner’s soaring popularity, product leadership and growing footprint are likely to have aided its results in the quarter to be reported.
Here's a sneak peek at the firm’s revenues and EBIT projections for the to-be-reported quarter.
The Zacks Consensus Estimate for BorgWarner’s Air Management segment’s sales is pegged at $1,939 million, suggesting a rise from $1,796 million reported in the previous quarter. EBIT from the segment is estimated at $273 million, suggesting a drop from $279 million recorded in the previous quarter.
The consensus mark for first-quarter sales from the e-Propulsion & Drivetrain segment is pegged at $1,434 million, suggesting a drop from the $1,531 million registered in the preceding quarter. Also, the segmental EBIT estimate of $109 million marks a drop from $143 million generated in the fourth quarter of 2022.
The consensus mark for the Fuel System unit’s quarterly sales is pegged at $626 million, up from $607 million reported in the fourth quarter. The EBIT for the segment is pegged at $69 million, indicating a rise from $56 million.
The consensus mark for quarterly sales from the Aftermarket unit is pegged at $344 million, indicating a rise from $325 million recorded in the previous quarter. The EBIT for the segment stands at $39.49 million, indicating a drop from $57 million.
Other Stocks With the Favorable Combination
Let’s take a look at some other players from the auto space that, according to our model, have the right combination of elements to post an earnings beat for the respective quarters to be reported:
American Axle AXL will release first-quarter 2023 results on May 05. The company has an Earnings ESP of +36.00% and a Zacks Rank #3.
The Zacks Consensus Estimate for American Axle’s to-be-reported quarter’s loss and revenues is pegged at 6 cents per share and $1.53 billion, respectively. AXL surpassed earnings estimates in three out of the trailing four quarters and missed in one in fiscal year 2022, the average surprise being 325.18%.
Aeva Technologies AEVA will release first-quarter 2023 results on May 10. The company has an Earnings ESP of +6.25%. The Zacks Consensus Estimate for Aeva’s to-be-reported quarter’s loss and revenues is pegged at 16 cents per share and $0.88 million, respectively. AEVA surpassed earnings estimates in three out of the trailing four quarters and missed in one in fiscal year 2022, the average surprise being 13.68%.
AEVA has a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
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