Wolfe Research lifts BorgWarner Inc. [BWA] price estimate. Who else is bullish?

BorgWarner Inc. [NYSE: BWA] loss -3.49% or -1.45 points to close at $40.09 with a heavy trading volume of 3949199 shares. The company report on October 5, 2020 that BorgWarner Announces Final Results of Exchange Offer for Delphi Technologies’ 5.000% Senior Notes Due 2025.

BorgWarner Inc. (NYSE: BWA) (“BorgWarner”) announced today that as of 5:00 p.m., New York City time, on October 1, 2020 (the “Expiration Date”), approximately $776.3 million in aggregate principal amount of outstanding 5.000% Senior Notes due 2025 (the “DT Notes”) of Delphi Technologies PLC (“Delphi Technologies”), representing approximately 97.04% of the $800 million total outstanding principal amount of the DT Notes, were validly tendered and not validly withdrawn (and consents thereby validly given and not validly revoked) in connection with the previously announced private exchange offer (the “Exchange Offer”) and related consent solicitation (the “Consent Solicitation”) made by BorgWarner on behalf of Delphi Technologies with respect to the DT Notes.

BorgWarner previously announced it had received the requisite number of consents to adopt certain proposed amendments (the “Amendments”) to the DT Notes and the related indenture (the “DT Indenture”) under which they were issued and entered into a supplemental indenture to the DT Indenture implementing the Amendments. The supplemental indenture became effective upon its execution and delivery, and the Amendments will become operative upon settlement of the Exchange Offer, which is expected to occur on or about October 5, 2020 (the “Settlement Date”).

It opened the trading session at $42.00, the shares rose to $42.24 and dropped to $39.86, the range by which the price of stock traded the whole day. The daily chart for BWA points out that the company has recorded 55.75% gains over the past six months. However, it is still -135.82% lower than its most recent low trading price.

If we look at the average trading volume of 2.95M shares, BWA reached to a volume of 3949199 in the most recent trading day, which is why market watchdogs consider the stock to be active.

Here is what top equities market gurus are saying about BorgWarner Inc. [BWA]:

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for BWA shares is $45.87 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on BWA stock is a recommendation set at 2.20. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

Wolfe Research have made an estimate for BorgWarner Inc. shares, keeping their opinion on the stock as Outperform, with their previous recommendation back on May 28, 2020. The new note on the price target was released on April 13, 2020, representing the official price target for BorgWarner Inc. stock. Previously, the target price had yet another raise to $25, while Morgan Stanley analysts kept a Equal-Weight rating on BWA stock.

The Average True Range (ATR) for BorgWarner Inc. is set at 1.47, with the Price to Sales ratio for BWA stock in the period of the last 12 months amounting to 0.96. The Price to Book ratio for the last quarter was 1.79, with the Price to Cash per share for the same quarter was set at 9.58. Price to Free Cash Flow for BWA in the course of the last twelve months was 26.19 with Quick ratio for the last quarter at 1.90.

Trading performance analysis for BWA stock

BorgWarner Inc. [BWA] gain into the green zone at the end of the last week, gaining into a positive trend and gaining by 1.39. With this latest performance, BWA shares dropped by -5.20% in over the last four-week period, additionally plugging by 55.75% over the last 6 months – not to mention a rise of 15.50% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for BWA stock in for the last two-week period is set at 50.77, with the RSI for the last a single of trading hit 53.07, and the three-weeks RSI is set at 51.86 for BorgWarner Inc. [BWA]. The present Moving Average for the last 50 days of trading for this stock 40.09, while it was recorded at 40.33 for the last single week of trading, and 34.40 for the last 200 days.

BorgWarner Inc. [BWA]: A deeper dive into fundamental analysis

Operating Margin for any stock indicates how profitable investing would be, and BorgWarner Inc. [BWA] shares currently have an operating margin of +12.11 and a Gross Margin at +20.69. BorgWarner Inc.’s Net Margin is presently recorded at +7.33.

Return on Total Capital for BWA is now 18.46, given the latest momentum, and Return on Invested Capital for the company is 11.83. Return on Equity for this stock inclined to 16.70, with Return on Assets sitting at 7.54. When it comes to the capital structure of this company, BorgWarner Inc. [BWA] has a Total Debt to Total Equity ratio set at 43.46. Additionally, BWA Total Debt to Total Capital is recorded at 30.29, with Total Debt to Total Assets ending up at 21.08. Long-Term Debt to Equity for the company is recorded at 37.00, with the Long-Term Debt to Total Capital now at 25.79.

Reflecting on the efficiency of the workforce at the company, BorgWarner Inc. [BWA] managed to generate an average of $25,724 per employee. Receivables Turnover for the company is 5.18 with a Total Asset Turnover recorded at a value of 1.03.BorgWarner Inc.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 1.90 and a Current Ratio set at 2.40.

BorgWarner Inc. [BWA]: An earnings per share (EPS) analysis

With the latest financial reports released by the company, BorgWarner Inc. posted 0.96/share EPS, while the average EPS was predicted by analysts to be reported at 0.85/share. When compared, the two values demonstrate that the company surpassed the estimates by a Surprise Factor of 12.90%. The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for BWA. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for BorgWarner Inc. go to 1.79%.

An analysis of insider ownership at BorgWarner Inc. [BWA]

There are presently around $10,830 million, or 96.45% of BWA stock, in the hands of institutional investors. The top three institutional holders of BWA stocks are: VANGUARD GROUP INC with ownership of 26,425,383, which is approximately -2.467% of the company’s market cap and around 0.30% of the total institutional ownership; BLACKROCK INC., holding 17,806,638 shares of the stock with an approximate value of $713.87 million in BWA stocks shares; and FMR LLC, currently with $628.19 million in BWA stock with ownership of nearly 145.089% of the company’s market capitalization.

Positions in BorgWarner Inc. stocks held by institutional investors increased at the end of August and at the time of the August reporting period, where 303 institutional holders increased their position in BorgWarner Inc. [NYSE:BWA] by around 46,579,442 shares. Additionally, 264 investors decreased positions by around 21,130,740 shares, while 62 investors held positions by with 202,439,381 shares. The mentioned changes placed institutional holdings at 270,149,563 shares, according to the latest SEC report filing. BWA stock had 103 new institutional investments in for a total of 6,219,235 shares, while 70 institutional investors sold positions of 3,121,367 shares during the same period.

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