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Headquartered in Auburn Hills, Michigan, BorgWarner Inc. (BWA) is a global leader in automotive technology solutions. With a market cap of $6.9 billion, BorgWarner is dedicated to advancing mobility through its innovative portfolio of powertrain, electrification, and propulsion systems. Serving customers across North America, Europe, and Asia, the company focuses on delivering cutting-edge, sustainable solutions that enhance vehicle performance, efficiency, and emissions reduction.
Shares of BorgWarner have significantly underperformed the broader market over the past 52 weeks. BWA has jumped 6.9% over this time frame, while the broader S&P 500 Index ($SPX) has gained 22.6%. In 2025, BWA stock is down 2%, compared to the SPX's 3.1% YTD gain.
Zooming in further, BWA has also underperformed the Consumer Discretionary Select Sector SPDR Fund’s (XLY) 31.1% gains over the past year.
Today, BorgWarner reported its Q4 earnings, posting revenue of $3.44 billion, down 2.4% year-over-year and below Wall Street’s estimate of $3.48 billion. However, adjusted EPS of $1.01 surpassed analyst expectations of $0.92. The company generated $682 million in operating cash flow and $539 million in free cash flow.
The company has issued its full-year 2025 guidance, projecting net sales between $13.4 billion and $14 billion, slightly below the $14.1 billion recorded in 2024. The company expects adjusted EPS between $4.05 and $4.40. Operating cash flow is anticipated to be between $1.33 billion and $1.38 billion, while free cash flow is expected between $650 million and $750 million. BWA stock has dipped after the result.
For the current fiscal year, ending in December, analysts expect BorgWarner to report a 7.8% year-over-year growth in adjusted EPS to $4.56. The company’s earnings surprise history is mixed. It surpassed analysts’ bottom-line estimates in three of the past four quarters while missing on one other occasion.
Among the 15 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on nine “Strong Buys,” one “Moderate Buy,” and five “Holds.”
On Jan. 30, John Murphy of Bank of America Securities (BAC) reaffirmed his “Buy” rating on BorgWarner, with a price target of $42, which suggests a potential upside of 34.7%.
BWA’s mean price target of $39.71 represents a premium of 27.4% from current price levels. The Street-high target of $49 suggests a potential upside of 57.2%.
