BorgWarner Delivers Strong Content Growth, With Major BEV Acceleration On The Way

Stephen Simpson
20.42K Followers

Summary

  • BorgWarner posted surprisingly strong fourth quarter results, with 21% organic growth that was far ahead of <2% underlying global vehicle production growth.
  • Auto production growth in 2023 is looking more muted than I'd expected, but BorgWarner remains strongly leveraged to the growth in EV build rates and could see double-digit organic growth.
  • Margins remain pressured by inflation, R&D, and electrification product ramp costs, but management expects the BEV business to be at breakeven late in 2023 or early in 2024.
  • BorgWarner is emerging as a leader in BEV components and looks undervalued below $60.

Cutaway view of Electric Vehicle Motor with suspension on white background

Chesky_W/iStock via Getty Images

It wasn’t so long ago that writing about vehicle electrification brought out the “it’ll never happen … it’s just a fad (or fraud)” naysayers, but I’ve noticed that as EV production rates climb, those commenters seem to have slunk into the shadows. Likewise, the

This article was written by

20.42K Followers
Stephen Simpson is a freelance financial writer and investor.Spent close to 15 years on the Street (sell-side, buy-side, equities, bonds).

Analyst’s Disclosure:I/we have a beneficial long position in the shares of BWA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

The author owns shares of BorgWarner and the locally-listed shares of Valeo.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

About BWA Stock

SymbolLast Price% Chg
Market Cap
PE
Yield
Rev Growth (YoY)
Short Interest
Prev. Close
Compare to Peers

More on BWA

Related Stocks

SymbolLast Price% Chg
BWA
--