Why BorgWarner (BWA) is a Top Value Stock for the Long-Term

Zacks
2024-12-30

It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors.

Achieving those goals is made easier with the Zacks Style Scores, a unique set of guidelines that rates stocks based on popular investing methodologies, namely value, growth, and momentum. The Style Scores can help you narrow down which stocks are better for your portfolio and which ones can beat the market over the long-term.

Why Investors Should Pay Attention to This Value Stock

Different than growth or momentum investors, value-focused investors are all about finding good stocks at good prices, and discovering which companies are trading under what their true value is before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to help pick out the most attractive and discounted stocks.

BorgWarner (BWA)

Michigan-based BorgWarner, Inc. is a global leader in clean and efficient technology solutions required for combustion, hybrid and electric vehicles. Its products include four-wheel-drive and all-wheel-drive transfer cases (primarily for light trucks and sport utility vehicles or SUVs), as well as automatic transmission and timing chain systems. These products are aimed at improving vehicle performance, propulsion efficiency, stability and air quality. These products are produced and sold worldwide, primarily to OEMs of passenger cars, SUVs, trucks and commercial transportation products.

BWA boasts a Value Style Score of A and VGM Score of A, and holds a Zacks Rank #2 (Buy) rating. Shares of BorgWarner are trading at a forward earnings multiple of 7.6X, as well as a PEG Ratio of 0.7, a Price/Cash Flow ratio of 5.1X, and a Price/Sales ratio of 0.5X.

Many value investors pay close attention to a company's earnings as well. For BWA, six analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.13 to $4.22 per share for 2024. Per share BWA boasts an average earnings surprise of 13.8%.

BWA should be on investors' short lists because of its impressive earnings and valuation fundamentals, a good Zacks Rank, and strong Value and VGM Style Scores.

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