Goldman Sachs analyst Mark Delaney has maintained their neutral stance on BWA stock, giving a Hold rating today.
Mark Delaney’s Hold rating for BorgWarner’s stock is based on a nuanced assessment of the company’s financial outlook and market position. Although BorgWarner has demonstrated the ability to maintain margin resilience in various electric vehicle (EV) transition scenarios, the company’s revenue and earnings per share (EPS) guidance for the coming year have fallen short of market expectations. The forecasted downturn in year-over-year sales of foundational products, coupled with a slower-than-anticipated acceleration in sales of eProducts for battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs), are central to Delaney’s cautious stance.
Further influencing the Hold rating are the dynamics of the traditional product market and the pace of transition towards BEVs by Western original equipment manufacturers (OEMs). While there is potential for an increase in sales of traditional products like turbochargers later in 2024 or 2025, the current growth rate remains measured. On a positive note, BorgWarner has secured new design wins for its eProducts, indicating progress in this area, yet the profitability from these newer products has not been as robust as expected, prompting a conservative outlook on the stock.
According to TipRanks, Delaney is a 5-star analyst with an average return of 15.1% and a 60.31% success rate. Delaney covers the Consumer Cyclical sector, focusing on stocks such as Tesla, Fisker, and ChargePoint Holdings.
In another report released today, CFRA also downgraded the stock to a Hold with a $34.00 price target.
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BorgWarner (BWA) Company Description:
BorgWarner, Inc. engages in the provision of technology solutions for combustion, hybrid and electric vehicles. It operates through the following segments: Engine and Drivetrain. The Engine segment develops and manufactures products to improve fuel economy, reduce emissions and enhance performance. The Drivetrain segment focuses in the products that improve fuel economy, reduce emissions, and enhance performance in combustion, hybrid and electric vehicles. The company was founded in 1928 and is headquartered in Auburn Hills, MI.
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