BorgWarner (NYSE:BWA) Sets New 1-Year High – Still a Buy?

Shares of BorgWarner Inc. (NYSE:BWA) reached a new 52-week high on Friday . The company traded as high as $38.53 and last traded at $38.37, with a volume of 54579 shares traded. The stock had previously closed at $38.20.

Analysts Set New Price Targets

A number of brokerages have weighed in on BWA. Piper Sandler lifted their target price on BorgWarner from $37.00 to $44.00 and gave the company an “overweight” rating in a research report on Friday, August 1st. Guggenheim cut their price target on BorgWarner from $38.00 to $33.00 and set a “buy” rating on the stock in a report on Tuesday, April 22nd. Bank of America boosted their target price on BorgWarner from $35.00 to $41.00 and gave the stock a “buy” rating in a research note on Monday, June 16th. Wells Fargo & Company boosted their target price on BorgWarner from $45.00 to $46.00 and gave the stock an “overweight” rating in a research note on Friday, August 1st. Finally, JPMorgan Chase & Co. boosted their target price on BorgWarner from $43.00 to $45.00 and gave the stock an “overweight” rating in a research note on Monday, August 4th. Six analysts have rated the stock with a hold rating, ten have given a buy rating and one has issued a strong buy rating to the company’s stock. Based on data from MarketBeat, the company currently has a consensus rating of “Moderate Buy” and an average target price of $39.50.

BorgWarner Trading Up 0.8%

The company has a 50 day simple moving average of $34.75 and a 200 day simple moving average of $31.42. The company has a debt-to-equity ratio of 0.64, a quick ratio of 1.66 and a current ratio of 2.02. The company has a market capitalization of $8.33 billion, a PE ratio of 40.95, a price-to-earnings-growth ratio of 1.16 and a beta of 1.10.

BorgWarner (NYSE:BWA) last posted its quarterly earnings data on Thursday, July 31st. The auto parts company reported $1.21 EPS for the quarter, topping the consensus estimate of $1.06 by $0.15. BorgWarner had a return on equity of 16.17% and a net margin of 1.50%. The company had revenue of $3.64 billion during the quarter, compared to analyst estimates of $3.56 billion. During the same period in the previous year, the business earned $1.19 EPS. BorgWarner’s quarterly revenue was up 1.0% on a year-over-year basis. Analysts anticipate that BorgWarner Inc. will post 4.28 earnings per share for the current year.

BorgWarner Increases Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Monday, September 15th. Investors of record on Tuesday, September 2nd will be given a $0.17 dividend. This represents a $0.68 annualized dividend and a yield of 1.8%. This is a positive change from BorgWarner’s previous quarterly dividend of $0.11. BorgWarner’s dividend payout ratio is presently 46.81%.

BorgWarner declared that its Board of Directors has authorized a stock repurchase program on Thursday, July 31st that allows the company to repurchase $1.00 billion in shares. This repurchase authorization allows the auto parts company to repurchase up to 13.2% of its stock through open market purchases. Stock repurchase programs are typically a sign that the company’s board believes its stock is undervalued.

Insider Activity at BorgWarner

In other news, EVP Tonit M. Calaway sold 27,736 shares of the firm’s stock in a transaction on Monday, May 12th. The stock was sold at an average price of $32.83, for a total transaction of $910,572.88. Following the completion of the transaction, the executive vice president directly owned 214,521 shares in the company, valued at $7,042,724.43. This trade represents a 11.45% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. Also, VP Isabelle Mckenzie sold 5,000 shares of the firm’s stock in a transaction on Friday, May 16th. The stock was sold at an average price of $33.25, for a total value of $166,250.00. Following the transaction, the vice president owned 63,445 shares of the company’s stock, valued at approximately $2,109,546.25. This represents a 7.31% decrease in their ownership of the stock. The disclosure for this sale can be found here. Corporate insiders own 0.45% of the company’s stock.

Institutional Trading of BorgWarner

A number of hedge funds and other institutional investors have recently bought and sold shares of BWA. Blackston Financial Advisory Group LLC increased its position in shares of BorgWarner by 3.4% during the second quarter. Blackston Financial Advisory Group LLC now owns 7,970 shares of the auto parts company’s stock worth $267,000 after purchasing an additional 265 shares in the last quarter. Trajan Wealth LLC grew its holdings in shares of BorgWarner by 4.6% during the first quarter. Trajan Wealth LLC now owns 7,978 shares of the auto parts company’s stock worth $229,000 after buying an additional 353 shares during the last quarter. Assetmark Inc. grew its holdings in shares of BorgWarner by 81.8% during the second quarter. Assetmark Inc. now owns 809 shares of the auto parts company’s stock worth $27,000 after buying an additional 364 shares during the last quarter. Tectonic Advisors LLC grew its holdings in shares of BorgWarner by 2.3% during the second quarter. Tectonic Advisors LLC now owns 17,002 shares of the auto parts company’s stock worth $569,000 after buying an additional 388 shares during the last quarter. Finally, Norinchukin Bank The grew its holdings in shares of BorgWarner by 4.4% during the fourth quarter. Norinchukin Bank The now owns 9,501 shares of the auto parts company’s stock worth $302,000 after buying an additional 402 shares during the last quarter. 95.67% of the stock is currently owned by institutional investors and hedge funds.

About BorgWarner

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.