📊 BWA Key Takeaways
Is Borgwarner Inc. (BWA) a Good Investment?
BorgWarner faces deteriorating fundamentals with flat revenue growth, 17.3% YoY net income decline, and critically low free cash flow generation (0.3% FCF margin). Despite adequate liquidity and debt coverage ratios, the company is generating minimal excess cash to service its $3.9B debt load or fund growth, indicating fundamental business weakness in a sector undergoing structural transition.
BorgWarner's fundamentals show a mixed profile: liquidity is solid and leverage appears manageable, but profitability is weak and earnings are declining despite flat revenue. The business remains financially stable, yet negative free cash flow and thin margins reduce the quality of current growth and limit near-term fundamental upside.
Borgwarner Inc. Key Strengths (BWA)
- Strong liquidity position with 2.13x current ratio and 1.75x quick ratio
- Solid interest coverage of 13.4x demonstrates ability to service debt obligations
- Reasonable gross margin of 19.2% and stable operating cash flow of $152M
- Strong liquidity with a 2.07x current ratio, 1.70x quick ratio, and $2.31B in cash
- Manageable balance sheet leverage with 0.72x debt-to-equity and 5.4x interest coverage
- Large, stable revenue base of $14.32B provides operating scale and resilience
BWA Stock Risks: Borgwarner Inc. Investment Risks
- Zero revenue growth (0% YoY) indicates stagnant market demand or lost market share
- Declining profitability with net income down 17.3% YoY and ROE/ROA of only 4.4% and 1.8%
- Critical free cash flow weakness at only $9M ($3.5B revenue) with CapEx consuming 94% of operating cash flow, limiting debt reduction and growth investment
- High debt burden of $3.9B with deteriorating ability to generate excess cash for deleveraging
- Net income and diluted EPS declined year over year, indicating weakening bottom-line performance
- Low operating margin of 3.7% and net margin of 1.9% leave limited cushion against cost pressure or demand weakness
- Negative free cash flow of -$201M suggests current earnings are not converting well into cash after capital spending
Key Metrics to Watch
- Free cash flow trends and FCF margin expansion/contraction
- Revenue growth inflection and operating leverage recovery
- Debt-to-EBITDA ratio and cash deployment for deleveraging vs. capex
- Free cash flow and operating cash flow conversion
- Operating margin and net income trend
Borgwarner Inc. (BWA) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The relatively thin 0.3% FCF margin may limit capital allocation flexibility. Strong liquidity with a 2.13x current ratio provides a solid financial cushion.
BWA Profit Margin, ROE & Profitability Analysis
BWA vs Automotive Sector: How Borgwarner Inc. Compares
How Borgwarner Inc. compares to Automotive sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Borgwarner Inc. Stock Overvalued? BWA Valuation Analysis 2026
Based on fundamental analysis, Borgwarner Inc. has mixed fundamental signals relative to the Automotive sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Borgwarner Inc. Balance Sheet: BWA Debt, Cash & Liquidity
BWA Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Borgwarner Inc.'s revenue has remained relatively flat over the 5-year period, with a 4% decline. The most recent EPS of $2.67 reflects profitable operations.
BWA Revenue Growth, EPS Growth & YoY Performance
BWA Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $3.5B | $157.0M | $0.72 |
| Q3 2025 | $3.4B | $158.0M | $0.73 |
| Q2 2025 | $3.6B | $224.0M | $1.03 |
| Q1 2025 | $3.5B | $157.0M | $0.72 |
| Q3 2024 | $3.4B | $50.0M | $0.21 |
| Q2 2024 | $3.6B | $204.0M | $0.87 |
| Q1 2024 | $3.4B | $206.0M | $0.90 |
| Q3 2023 | $3.2B | $50.0M | $0.21 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Borgwarner Inc. Dividends, Buybacks & Capital Allocation
BWA SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Borgwarner Inc. (CIK: 0000908255)
📋 Recent SEC Filings
❓ Frequently Asked Questions about BWA
What is the AI rating for BWA?
Borgwarner Inc. (BWA) has a Combined AI Grade of C from Claude (C) and ChatGPT (B) with 78% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are BWA's key strengths?
Claude: Strong liquidity position with 2.13x current ratio and 1.75x quick ratio. Solid interest coverage of 13.4x demonstrates ability to service debt obligations. ChatGPT: Strong liquidity with a 2.07x current ratio, 1.70x quick ratio, and $2.31B in cash. Manageable balance sheet leverage with 0.72x debt-to-equity and 5.4x interest coverage.
What are the risks of investing in BWA?
Claude: Zero revenue growth (0% YoY) indicates stagnant market demand or lost market share. Declining profitability with net income down 17.3% YoY and ROE/ROA of only 4.4% and 1.8%. ChatGPT: Net income and diluted EPS declined year over year, indicating weakening bottom-line performance. Low operating margin of 3.7% and net margin of 1.9% leave limited cushion against cost pressure or demand weakness.
What is BWA's revenue and growth?
Borgwarner Inc. reported revenue of $3.5B.
Does BWA pay dividends?
Borgwarner Inc. pays dividends, with $35.0M distributed to shareholders in the trailing twelve months.
Where can I find BWA SEC filings?
Official SEC filings for Borgwarner Inc. (CIK: 0000908255) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is BWA's EPS?
Borgwarner Inc. has a diluted EPS of $1.16.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is BWA's fundamental grade?
Based on our AI fundamental analysis in June 2026, Borgwarner Inc. has a C grade with 78% confidence. Review the strengths and risks sections above for full context. This is not investment advice.
Is BWA stock overvalued or undervalued?
Valuation metrics for BWA: ROE of 4.4% (sector avg: 12%), net margin of 6.8% (sector avg: 6%). Compare these metrics with sector averages to assess valuation.
What is BWA's AI grade for 2026?
Our dual AI analysis gives Borgwarner Inc. a combined C grade for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is BWA's free cash flow?
Borgwarner Inc.'s operating cash flow is $152.0M, with capital expenditures of $143.0M. FCF margin is 0.3%.
How does BWA compare to other Automotive stocks?
Vs Automotive sector averages: Net margin 6.8% (avg: 6%), ROE 4.4% (avg: 12%), current ratio 2.13 (avg: 1.2).