BorgWarner's (BWA) Q4 Earnings Beat Estimates, Rise Y/Y

BorgWarner, Inc.BWA is a leading manufacturer of powertrain products for major automakers. Its products include four-wheel-drive and all-wheel-drive transfer cases (primarily for light trucks and sport utility vehicles), as well as automatic transmission and timing chain systems. These products are produced and sold worldwide, primarily to original equipment manufacturers.

BorgWarner is poised to benefit from strong demand, global expansion, capital deployment and restructuring of the Drivetrain segment. However, negative impact from foreign currencies, pricing pressure from original equipment manufacturers (OEMs) and intensifying competition are some concerns.

Estimate Trend & Surprise History

Investors should note that the fourth-quarter earnings estimates for BorgWarner have remained stable over the past 30 days.

Meanwhile, the company has a positive record in terms of earnings surprises. BorgWarner beat earnings estimates in each of the trailing four quarters. As a result, the company posted an average positive surprise of 2.30% over the last four quarters.

BorgWarner Inc. Price and EPS Surprise

BorgWarner Inc. Price and EPS Surprise | BorgWarner Inc. Quote

Investors have been eagerly awaiting BorgWarner's latest earnings report to see whether it delivers an earnings beat.

Zacks Rank

BorgWarner currently has a Zacks Rank #4 (Sell), but that could change following its earnings report which was just released. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

We have highlighted some of the key stats from this Michigan-based company's earnings announcement below:


BorgWarner reported adjusted earnings of 85 cents per share in the fourth quarter of 2016, marginally beating the Zacks Consensus Estimate of 84 cents. Adjusted earnings increased from 77 cents reported in the year-ago quarter.


BorgWarner logged revenues of $2.26 billion, missing the Zacks Consensus Estimate of $2.30 billion. However, revenues were 6.4% higher than a year-ago.

Key Stats/Developments to Note

For 2017, the company expects net sales of around $8.81-$9.04 billion, which translates into organic growth rate of 3.5-6%. The company expects negative impact of foreign currencies due to the depreciation of the Euro, Yuan and Pound of $320 million. Also, a negative impact of around $235 million due to the sale of the Remy light vehicle aftermarket business is expected by the company.

Further, BorgWarner expects net earnings in the range of $3.35-$3.45 per share in 2017.

Market Reaction

BorgWarner's shares were inactive following the release. It would be interesting to see how the market reacts to the results during the trading session today.

Check back later for our full write up on BorgWarner's earnings report!

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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