The current trading zone is interesting to the point that investors should pay attention to the stock and anticipate a return of the underlying upward trend.
Summary
● The company has strong fundamentals. More than 70% of listed companies have a lower mix of growth, profitability, debt and visibility criteria.
● In a short-term perspective, the company has interesting fundamentals.
Strengths
● The company returns high margins, thereby supporting business profitability.
● Considering the small differences between the analysts' various estimates, the group's business visibility is good.
● The company has attractive valuation levels with a low EV/sales ratio compared with its peers.
● With a P/E ratio at 11.4 for the current year and 10.63 for next year, earnings multiples are highly attractive compared with competitors.
● Upward revisions of sales forecast reflect a renewed optimism among the analysts covering the stock.
● Over the past year, analysts have regularly revised upwards their sales forecast for the company.
● For the last twelve months, analysts have been gradually revising upwards their EPS forecast for the upcoming fiscal year.
● The average target price set by analysts covering the stock is above current prices and offers a tremendous appreciation potential.
Weaknesses
● The group usually releases earnings worse than estimated.
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BorgWarner Inc. specializes in the design, manufacturing, and marketing of automotive equipment. Net sales break down by family of products as follows:
- air management products (54.6%): turbochargers, timing systems, emissions systems, thermal systems, smart remote actuators, powertrain sensors, canisters, cabin heaters, battery heaters and battery charging products;
- e-propulsion & drivetrain products (30.3%): rotating electrical components, power electronics, control modules, software, friction and mechanical products for automatic transmissions and torque management products;
- gasoline and diesel fuel injection components and systems (15.1%): pumps, injectors, fuel rail assemblies, and complete systems.
At the end of 2023, the group had 79 production and assembly sites worldwide.
Net sales are distributed geographically as follows: the United States (16.4%), Germany (11.8%), Poland (7.9%), Hungary (6.4%), Europe (9.8%), China (21.1%), Mexico (12.4%), South Korea (8.2%) and other (6%).