NYSE:BWA
$36.04
(2/9 1:58PM)
+1.9%
| Open | $35.84 |
Mkt Cap | $4.1 Billion |
| High | $36.69 |
52Wk High | $38.36 |
| Low | $35.5 |
52Wk Low | $14.62 |
| Volume | 2.1 Million |
Avg Vol 10D | 1.4 Million |
Ockham's Rating/Recommendation Summary
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BWA Revenue
Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, BWA the high and low end of the Price to Sales per share ratios are 0.98x and 0.50x respectively.
Notice that BWA's current Price to Sales per share ratio is 1.10x, which is high enough compared with historical norms of BWA to cause some concern. The current Price to Sales per share is near the upper end of the historical range. In our eyes, this is a negative factor because it is more likely that it will return to the normal range than continue rising outside of the range. At current sales per share levels, we would need to see a decline in the Price to Sales ratio of 47% merely to return BWA to its historical average.
BWA Cash Earnings
Looking at BWA specifically in their Cash Earnings capabilities, Ockham views BWA as significantly above their historical average multiples of Cash Earnings, as calculated by our proprietary analysis. It is incredibly important to understand that for BWA, the current level of Cash Earnings compared to its historical levels helps identify where BWA is in relation to what the investing community was willing to pay for this level of Cash Earnings in the past. With a historical high Cash Earnings per share ratio of 16.37 and a historical low Cash Earnings per share ratio of 7.21, an investor can relate where value becomes optimal.
Just recall that when a stock's price, as in the cases of BWA, is significantly elevated to the level of Cash Earnings being generated, the market has already priced in much of that value. For example, the historical average for BWA's Price to Cash Earnings ratio is 116% below the current ratio of 25.52. That is not an insignificant amount, and diminishes our overall outlook on BWA. However, you need to review several areas of a company's potential, and as management would point out, one metric is not the end-all-be-all of any analysis.
BWA Dividends
A strong dividend payment history is looked upon as a favorable characteristic on a company’s future and potentially can receive a positive Ockham rating. That being said, we don't require dividend payments for company's whose management has elected to forgo them entirely.
Borg Warner Inc. (BWA) Discussed on CNBC's Fast Money
Borg Warner Inc. is in the news. Find out how this impacts BWA trading on Ockham Research.
>>> it is time for the final tim. >> the brazil olympics trade is moving passengers and freight gol airlines, gol. >> guy? >> rimm looks interesting now. >> we covered some BORG WARNER bwa. >> unbelievable cash flow for pepsi. I like the action we saw in highs or not, this thing's going that does it for us. Thanks so much for watching. Tune in tonight at 8:00 p.M. For an instant replay of "fast money" followed by "options action" in its new time slot, 8:30 p.M. Eastern time. Weekend. >> announcer: monday, from recent rally to double dip meet the investor who saw this latest plunge coming. Plus, it's not what it looks the pit boss reveals a stock with a secret identity. "fast money." 5:00 eastern monday on cnbc,
“… highs or not, this thing's going that does it for us. Thanks so much for watching. Tune in tonight at 8:00 p.M. For an instant replay of "fast money" followed by "options action" in its new time slot, 8:30 p.M. Eastern time. Weekend. >> announcer: monday, from recent rally to double dip meet the investor who saw this latest plunge coming. Plus, it's not what it looks the pit boss reveals a stock with a secret identity. "fast money." 5:00 eastern monday on cnbc, …”
Borg Warner Inc. (BWA) Discussed on CNBC's Fast Money
Borg Warner Inc. is in the news. Find out how this impacts BWA trading on Ockham Research.
Where it's slightly north of where you've got to step in and buy it again. >> if mulally's forecast in 2011 comes true, karen, does that make the automakers attractive in your view? >> they've had a huge run up. If that were to happen, yeah, it's like BORG WARNER would move but that is a big move from where we are right now. Not that it can't happen. It could happen. I think we've just pulled some sales closer with cash for clunkers that maybe aren't initial -- that aren't incremental demand. >> you're factoring in quite a time frame there. If you're looking at ford, by the way, the option there's dirt cheap right now. The opportunities are there. If you believe in this story, if you believe even going out six months, nine months, the options go all the way out into the leap options which go out multiple gives you an opportunity to get involved with -- >> real quickly, and on their balance sheet, that which was -- you know, what you were vilifying these auto companies for, ford increased their cash position by 3 billion in the last quarter, they're knocking down debt, their cost basis suddenly fantastically cheaper not only because they've improved with their unions but they've restructured a lot of >> and mulally told us all this when the stock was trading 4. That was the opportunity. That's when we were all looking at ford it was attractive. It's a little less attractive up at these levels. >> and they've got to be gaining market share if you look at the
“… G WARNER would move but that is a big move from where we are right now. Not that it can't happen. It could happen. I think we've just pulled some sales closer with cash for clunkers that maybe aren't initial -- that aren't incremental demand. >> you're factoring in quite a time frame there. If you're looking at ford, by the way, the option there's dirt cheap right now. The opportunities are there. If you believe in this story, if you believe even going out six months, nine months, the options go all the way out into the leap options which go out multiple gives you an opportunity to get involved with -- >> real quickly, and on their balance sheet, that which was -- you know, what you were vilifying these auto companies for, ford increased their cash position by 3 billion in the last quarter, they're knocking down debt, their cost basis suddenly fantastically cheaper not only because they've improved with their unions but they've restructured a lot of >> and mulally told us all this when the stock was trading 4. That was the opportunity. That's when we were all looking at ford it was attractive. It's a little less attractive up at these levels. >> and they've got to be gaining market share if you look at the …”
Borg Warner Inc. (BWA) Discussed on CNBC's Fast Money
Borg Warner Inc. is in the news. Find out how this impacts BWA trading on Ockham Research.
>> they secured some financing this week, said it would be about -- this is a short covering rally of a magnitude I can't even tell you. If oil continues to go higher, amr will go right back down. >> drop on the week for BORG WARNER down 8%. >> you know, this one has bothered me for a while. I think street estimates are too high. Key bank also said the street was hoo high. I think they'll miss again. We are short. Hasn't worked that well, recently, but over time has been great. >> pop for nokia. >> move from 12 to 16 off the lows. Great run. >> a drop for our colleague chuck todd. The nbc political colleague chuck todd got a good scolding from health and human services secretary kathleen sebelius
“… this one has bothered me for a while. I think street estimates are too high. Key bank also said the street was hoo high. I think they'll miss again. We are short. Hasn't worked that well, recently, but over time has been great. >> pop for nokia. >> move from 12 to 16 off the lows. Great run. >> a drop for our colleague chuck todd. The nbc political colleague chuck todd got a good scolding from health and human services secretary kathleen sebelius …”
Borg Warner Inc. (BWA) Discussed on CNBC's Mad Money
Borg Warner Inc. is in the news. Find out how this impacts BWA trading on Ockham Research.
>>> sell BORG WARNER, sell devon and the king is b.J.'s. There's always a bull market i'm jim cramer and I will see you tomorrow. >>> senator kennedy would have compromised on health. So far president obama has not. The silent stock market rally up eight straight days. The greatest story never told. The fdic has problems. Is your money safe?
“… straight days. The greatest story never told. The fdic has problems. Is your money safe? …”
Borg Warner Inc. (BWA) Discussed on CNBC's Mad Money
Borg Warner Inc. is in the news. Find out how this impacts BWA trading on Ockham Research.
Stock is bwa. Makes turbochargers and torque transfer systems. They make cars run more efficiently and reduce emissions. BORG WARNER's chart really ugly. It shows the classic example of a stock breaking down. Dan fitzpatrick, our go-to chartist on cnbc on "the call" and my colleague at "real money" part of the street side i'm chairman of, he today sent this to me and said, jim, this one is a sell. The breakdown for BORG WARNER below its 50-day average. This is the moving average so the red line is the moving and this measures the short-term trajectory and this stock has broken through that 50 day. When that happens, fitz says you have to sell it. In the past this 50 day has been every time it's hit that it's bounced. Every time. But that's the level where buyers soak up stock because they think it's gotten too cheap. It now has become what's known as resistant. He doesn't think it can get through it. This is where sellers flood the market because they think it's become so expensive. This is a technical analysis but I know you love it so i'm giving it to you. Fitzpatrick thinks the BORG WARNER breakdown is about the end of the government's auto infused bubble caused for the clash for clunkers program. It's over and now that the stock's benefited, all the stocks that have benefitted from that's the technical picture. What about the fundamental? I think the stock is clearly overinflated by cash for it had to break down. It moved up too far too fast. That doesn't mean the business was overinflated or its stocks will suffer. It's just the stock is suffering not the company. BORG WARNER is a strong company. It has a great balance sheet. The most recent quarter, the street was looking for a gain, the miss was rational. Lower sales of diesel cars were both temporary problems. The european clunkers program encouraged people to switch from diesel to gasoline cars. I think the auto industry is coming back. I like the ford motor preferred. I also think the whole group has gotten ahead of itself because of the excitement for the program. And BORG WARNER at 30 is still pricing in perfection. Unlike most I don't think car sales are going to fall off the cliff but I don't think they'll be robust enough to keep borg i'm with fitzpatrick on this chart. I think the stock goes lower. But eventually I think it will be worth buying again based on the fundamentals because the auto industry is on the mend and next year will be a better year.
“… "the call" and my colleague at "real money" part of the street side i'm chairman of, he today sent this to me and said, jim, this one is a sell. The breakdown for BORG WARNER below its 50-day average. This is the moving average so the red line is the moving and this measures the short-term trajectory and this stock has broken through that 50 day. When that happens, fitz says you have to sell it. In the past this 50 day has been every time it's hit that it's bounced. Every time. But that's the level where buyers soak up stock because they think it's gotten too cheap. It now has become what's known as resistant. He doesn't think it can get through it. This is where sellers flood the market because they think it's become so expensive. This is a technical analysis but I know you love it so i'm giving it to you. Fitzpatrick thinks the BORG WARNER breakdown is about the end of the government's auto infused bubble caused for the clash for clunkers program. It's over and now that the stock's benefited, all the stocks that have benefitted from that's the technical picture. What about the fundamental? I think the stock is clearly overinflated by cash for it had to break down. It moved up too far too fast. That doesn't mean the business was overinflated or its stocks will suffer. It's just the stock is suffering not the company. BORG WARNER is a strong company. It has a great balance sheet. The most recent quarter, the street was looking for a gain, the miss was rational. Lower sales of diesel cars were both temporary problems. The european clunkers program encouraged people to switch from diesel to gasoline cars. I think the auto industry is coming back. I like the ford motor preferred. I also think the whole group has gotten ahead of itself because of the excitement for the program. And BORG WARNER at 30 is still pricing in perfection. Unlike most I don't think car sales are going to fall off the cliff but I don't think they'll be robust enough to keep borg i'm with fitzpatrick on this chart. I think the stock goes lower. But eventually I think it will be worth buying again based on the fundamentals because the auto industry is on the mend and next year will be a better year. …”
Borg Warner Inc. (BWA) Discussed on CNBC's Fast Money
Borg Warner Inc. is in the news. Find out how this impacts BWA trading on Ockham Research.
It will be priced in when it's down to 0. Goldman sachs who's been negative on ford came out positive on ford two three weeks ago they put a $9 price target on it. I like ford, I also like BORG WARNER but not here. If it gets back to 24, 25. >> they priced that thing underneath 5ds it's been holding above $5 ever since. I think if it does pull back
“… d that thing underneath 5ds it's been holding above $5 ever since. I think if it does pull back …”
Borg Warner Inc. (BWA) Discussed on CNBC's Fast Money
Borg Warner Inc. is in the news. Find out how this impacts BWA trading on Ockham Research.
There as placid as basically -- >> because they're getting >> that's your theory. My theory is mr. Obama's chilling powers of mesmerizing. >> star trek aside, I think there is a trade there. And we've talked about BORG WARNER for a while there because it was a $19 stock. Close to around 30 today, up 2 1/2%. That's a place you want to go although that trade has gotten a little ahead of itself. You mentioned honeywell.
“… was a $19 stock. Close to around 30 today, up 2 1/2%. That's a place you want to go although that trade has gotten a little ahead of itself. You mentioned honeywell. …”
Borg Warner Inc. (BWA) Discussed on CNBC's Fast Money
Borg Warner Inc. is in the news. Find out how this impacts BWA trading on Ockham Research.
To be buying their tahoes and suvs but you're going to look for the more fuel-efficient cars the companies make, the more fuel-efficient, energy-efficient, better emissions, fuel drive trains, and it comes back to bwa, a name we talked about for a while. Unfortunately, the stock went from 14 1/2 to 25 1/2 in the last month. We've talked about that for a that trade is probably over. But a BORG WARNER is the name that will win in the long run. Karen's talked about its that's where you look. Plus the government's throwing 5 billion toward the auto makers -- the auto parts makers.
“… Unfortunately, the stock went from 14 1/2 to 25 1/2 in the last month. We've talked about that for a that trade is probably over. But a BORG WARNER is the name that will win in the long run. Karen's talked about its that's where you look. Plus the government's throwing 5 billion toward the auto makers -- the auto parts makers. …”
Borg Warner Inc. (BWA) Discussed on CNBC's Power Lunch
Borg Warner Inc. is in the news. Find out how this impacts BWA trading on Ockham Research.
If they go to bankruptcy, it goes to zero. That being said, doesn't mean that some of these auto parts look at the move that bwa has had. Much more diversified auto parts you look for dips. These stocks, you're buying on rallies. >>
“… If they go to bankruptcy, it goes to zero. That being said, doesn't mean that some of these auto parts look at the move that bwa has had. Much more diversified auto parts you look for dips. These stocks, you're buying on rallies. >> …”
Borg Warner Inc. (BWA) Discussed on CNBC's Fast Money
Borg Warner Inc. is in the news. Find out how this impacts BWA trading on Ockham Research.
They have a backlog in tremendous proportion. Largest producer of automatic transmissions on the planet, I valuation's rich but a huge about 15%. Bwa, rising star. It was a couple of years ago I think it could be again. >> all right there is your rising star. >>> coming up next why sachs was back in session.
“… tar. >>> coming up next why sachs was back in session. …”