BorgWarner beats Q3 adjusted EPS estimates, lifts 2026 outlook
Overview
US auto parts supplier's Q3 revenue fell 2.9% and slightly missed analyst expectations
Adjusted EPS for Q3 rose 12% and beat analyst expectations
Company raised full-year adjusted EPS guidance, citing share buybacks and lower tax rate
Outlook
BorgWarner raises 2026 adjusted EPS guidance to $5.20-$5.35 from $5.05-$5.30
Company expects 2026 net sales of $14.0 bln-$14.2 bln, down from $14.3 bln in 2025
BorgWarner sees 2026 adjusted operating margin at 10.7%-10.9%
Result Drivers
COST CONTROLS - Co said tighter cost controls helped deliver higher margins despite lower industry production volumes
LOWER PRODUCTION & BATTERY SALES - Co attributed Q3 revenue decline to lower market production volumes and reduced Battery Energy Systems segment sales
TAX RATE & SHARE COUNT - Co said higher adjusted EPS was mainly due to a lower effective tax rate and reduced share count from buybacks
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Sales | Slight Miss* | $3.49 bln | $3.51 bln (11 Analysts) |
Q3 Adjusted EPS | Beat | $1.39 | $1.25 (13 Analysts) |
Q3 EPS | $1.08 | ||
Q3 Gross Margin | 19.00% |
*Applies to a deviation of less than 1%; not applicable for per-share numbers.
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 13 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the auto, truck & motorcycle parts peer group is "buy"
Wall Street's median 12-month price target for BorgWarner Inc. is $85.00, about 52% above its October 28 closing price of $55.93
The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 12 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)