Here's Why BorgWarner (BWA) Fell More Than Broader Market
In the latest trading session, BorgWarner (BWA) closed at $32.04, marking a -0.74% move from the previous day. This change lagged the S&P 500's 0.65% loss on the day. Meanwhile, the Dow lost 0.18%, and the Nasdaq, a tech-heavy index, lost 1.16%.
Heading into today, shares of the auto parts supplier had gained 2.54% over the past month, lagging the Auto-Tires-Trucks sector's gain of 2.76% and the S&P 500's gain of 3.4% in that time.
Analysts and investors alike will be keeping a close eye on the performance of BorgWarner in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $0.88, marking a 19.27% fall compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $3.54 billion, reflecting a 15.34% fall from the equivalent quarter last year.
For the full year, the Zacks Consensus Estimates project earnings of $3.91 per share and a revenue of $14.76 billion, demonstrating changes of +4.27% and -6.81%, respectively, from the preceding year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for BorgWarner. These revisions help to show the ever-changing nature of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, there's been a 7.61% fall in the Zacks Consensus EPS estimate. BorgWarner is holding a Zacks Rank of #4 (Sell) right now.
In the context of valuation, BorgWarner is at present trading with a Forward P/E ratio of 8.26. This signifies a discount in comparison to the average Forward P/E of 13.1 for its industry.
One should further note that BWA currently holds a PEG ratio of 1.02. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Automotive - Original Equipment industry held an average PEG ratio of 0.86.
The Automotive - Original Equipment industry is part of the Auto-Tires-Trucks sector. At present, this industry carries a Zacks Industry Rank of 145, placing it within the bottom 43% of over 250 industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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BorgWarner Inc. (BWA) : Free Stock Analysis Report
