Core Insights - BorgWarner has secured two significant contracts in China, enhancing its leadership in dual clutch modules for dual clutch transmissions (DCT) [1][2] - The company has extended its partnership with a German OEM for a DCT clutch assembly for an additional seven years, reflecting a decade of successful collaboration [1][6] - BorgWarner's DCT technology offers superior performance, including reduced rotational inertia and minimized friction losses, leading to enhanced transmission efficiency [1][6] Contract Details - A seven-year extension was granted for the DCT clutch assembly with a German OEM in China, emphasizing BorgWarner's strong product expertise in DCT technology for both traditional and mild hybrid vehicles [1] - A new DCT clutch program was secured with a prominent Chinese transmission manufacturer for a leading OEM's SUVs and sedans, with mass production set to begin by the end of 2025 [2] Product Advantages - The DCT clutch module produced in BorgWarner's Taicang facility features a compact design, superior thermal robustness, and outstanding cost-effectiveness, which enhances shifting performance under various conditions [2] - Improvements in BorgWarner's clutch assembly result in significantly reduced drag torque and a smoother driving experience [1][6] Commitment to Innovation - BorgWarner continues to lead in wet DCT technology, focusing on delivering competitive solutions that create added value for customers [3]

"BorgWarner has been collaborating with this global OEM on a variety of projects and is looking forward to furthering our relationship by providing this efficient solution for battery and cabin heating," said Dr. Volker Weng, Vice President of BorgWarner Inc. and President and General Manager, Turbos and Thermal Technologies. "Our HVCH technology compared to other heaters allows us to provide a solution that improves robustness and provides cost improvements for our customer without altering the overall veh ...

Core Viewpoint - Wall Street anticipates a year-over-year decline in BorgWarner's earnings and revenues for the quarter ended March 2025, with a focus on how actual results compare to estimates impacting stock price [1][2]. Earnings Expectations - BorgWarner is expected to report quarterly earnings of $0.98 per share, reflecting a year-over-year decrease of 4.9% [3]. - Revenues are projected to be $3.39 billion, down 5.6% from the same quarter last year [3]. Estimate Revisions - The consensus EPS estimate has been revised 3.04% lower in the last 30 days, indicating a reassessment by analysts [4]. - A positive Earnings ESP of +1.39% suggests analysts have recently become more optimistic about BorgWarner's earnings prospects [10][11]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive or negative reading can predict deviations from consensus estimates, with positive readings being more reliable [6][7]. - Stocks with a positive Earnings ESP and a Zacks Rank of 1, 2, or 3 have historically produced positive surprises nearly 70% of the time [8]. Historical Performance - BorgWarner has beaten consensus EPS estimates in the last four quarters, with a notable surprise of +9.78% in the last reported quarter [12][13]. Industry Context - In the Zacks Automotive - Original Equipment industry, Lear is expected to report earnings of $2.64 per share, down 17% year-over-year, with revenues of $5.56 billion, a decrease of 7.3% [17]. - Lear's consensus EPS estimate has been revised 5.6% lower, but a higher Most Accurate Estimate results in an Earnings ESP of 3.44%, combined with a Zacks Rank of 4, making predictions of an earnings beat uncertain [18].

Core Insights - BorgWarner will present its latest inverter technology at the 46th Vienna Motor Symposium from May 14-16, 2025, including a double-sided cooled (DSC) 800V SiC power module and a next-generation multi-level traction inverter [1][2] Group 1: Technology Advancements - The DSC power module is designed to maximize efficiency and enable smaller, high-performance inverters for battery electric vehicles (BEVs) [1][2] - The innovative design of the DSC power module improves thermal management and power conversion efficiency, allowing for more compact and sustainable solutions in vehicle electrification [2] - The power module enhances thermal performance by extracting heat from both sides of the silicon carbide power switch, leading to lower junction temperatures or higher current densities [2] Group 2: Market Context - The growing adoption of BEVs and hybrids necessitates advancements in efficiency and power density for vehicle electrification [2] - BorgWarner's technology supports high-power applications and compact designs, contributing to the future of sustainable mobility [2][3]

Investment Rating - The report assigns an "Overweight" (OW) rating to General Motors (GM) and Ford, while Tesla and Rivian are rated "Underweight" (UW) [6][7]. Core Insights - The automotive industry is experiencing varied performance metrics across different companies, with GM and Ford showing potential upside in their stock prices, while Tesla and Rivian face significant downside risks [6][7]. - The report highlights the importance of valuation metrics such as EV/EBITDA, P/E ratios, and sales growth projections for assessing investment opportunities within the automotive sector [6][22]. Global Auto OEMs Investment Comparables - General Motors (GM) has a current price of $44.57 with a market cap of $43.067 billion and a target price of $53.00, indicating a 19% upside potential [6]. - Ford (F) is priced at $9.63 with a market cap of $38.294 billion and a target price of $11.00, representing a 14% upside [6]. - Ferrari (RACE) is valued at $439.97 with a target price of $460.00, showing a 5% upside [6]. - Tesla (TSLA) is currently priced at $241.37 with a target price of $120.00, indicating a -50% downside [6]. - Rivian (RIVN) has a price of $11.60 with a target price of $11.00, reflecting a -5% downside [6]. Global Auto Parts Suppliers Valuation Metrics - The average EV/EBITDA for US auto parts suppliers is projected at 1.8x for 2024, with a corresponding EBITDA margin of 12% [22]. - Aptiv (APTV) is rated "Overweight" with a current price of $51.71 and a target price of $102, indicating a 97% upside [22]. - Borg Warner (BWA) is rated "Overweight" with a price of $26.45 and a target price of $46, representing a 74% upside [22]. - Lear Corp (LEA) is rated "Overweight" with a price of $79.42 and a target price of $140, indicating a 76% upside [22]. Performance Metrics - The report indicates that the average revenue CAGR for US auto parts suppliers is projected to be 2% from 2023 to 2025 [74]. - The EBITDA margin for US auto parts suppliers is expected to be around 12% in 2025, with some companies showing higher margins [74][83]. - The report also highlights the financial returns of various suppliers, with some companies achieving significant returns on invested capital (ROIC) [54][56].

For more than 130 years, BorgWarner has been a transformative global product leader bringing successful mobility innovation to market. With a focus on sustainability, we're helping to build a cleaner, healthier, safer future for all. Forward Looking Statements: This release may contain forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act that are based on management's current outlook, expectations, estimates and projections. Words such as "anticipates," "believes," ...

Core Insights - BorgWarner has been recognized on Newsweek's list of Most Trustworthy Companies in America for the second consecutive year, highlighting its commitment to trust and transparency [1][2][6] - The company improved its ranking within the Automotive & Components industry category, placing in the top 10 for 2025 [2][6] Survey Methodology - The Most Trustworthy Companies in America 2025 list was based on a survey of 25,000 U.S. residents, evaluating companies on three pillars of trust: customer, employee, and investor trust, which accounted for 80% of the evaluation [7] - An additional 20% of the evaluation was derived from social listening analysis, which gathered 304,000 mentions about the companies from various internet segments, rated by sentiment, virality, and reach [7] Company Background - BorgWarner has over 130 years of experience as a global product leader in mobility innovation, focusing on sustainability to contribute to a cleaner and safer future [4]

Core Viewpoint - Goldman Sachs analyst Mark Delaney upgraded BorgWarner Inc. from Neutral to Buy, with a price forecast of $34, highlighting its favorable positioning in the market and limited risk from tariffs [1]. Group 1: Market Positioning - BorgWarner has a below-average level of U.S. imports, indicating limited risk from ongoing or future tariffs [1]. - Approximately 20% of BorgWarner's total revenue comes from China, with about 75% tied to domestic Chinese original equipment manufacturers (OEMs) [2]. - BorgWarner's hybrid and internal combustion engine products are expected to have a longer runway, supported by a broad portfolio that includes products for all powertrain types [3]. Group 2: Product Development and Growth - The company has several upcoming product launches with domestic Chinese auto OEMs, which will strengthen its foothold in this key market [3]. - Higher content per vehicle opportunities in both hybrid and battery electric vehicles are expected to benefit BorgWarner from the rising share of hybrid volumes in the near to medium term [4]. - Although the eProduct division is currently operating at a loss, ongoing restructuring efforts and long-term growth prospects are anticipated to help the company move toward profitability [4]. Group 3: Stock Performance - BWA shares closed lower by 4.54% to $25.67 on Thursday, reflecting market reactions to recent developments [4].

Group 1 - BorgWarner Inc. is currently facing challenges within the automotive industry, particularly due to Trump's 25% tariff on automotive imports, which is impacting car manufacturers and auto parts suppliers [1] - The direct impact of the tariff on BorgWarner appears to be relatively small, indicating some resilience in the company's operations amidst industry turmoil [1] Group 2 - The investment philosophy highlighted focuses on identifying mispriced securities by understanding the financial drivers of a company, often revealed through a DCF model valuation [1] - This investment approach is flexible and does not confine investors to traditional categories such as value, dividend, or growth investing, but rather assesses all prospects of a stock to evaluate risk-to-reward [1]

Company Overview - BorgWarner Inc. has been a transformative global product leader for over 130 years, focusing on mobility innovation [1] - The company is currently accelerating the transition to eMobility, aiming to contribute to a cleaner, healthier, and safer future [1] Upcoming Events - BorgWarner will hold its 2025 First Quarter Results Conference Call on May 7, 2025, at 9:30 am Eastern Time [2] - The conference call will be accessible live over the Internet via the company's investor relations website [2]