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S&P 500 (NYSE:SPY) component BorgWarner Inc. (NYSE:BWA) will unveil its latest earnings on Wednesday, October 31, 2012. BorgWarner is a global supplier of engineered automotive systems and components, mainly for powertrain applications.
BorgWarner Inc. Earnings Preview Cheat Sheet
Wall St. Earnings Expectations: The average analyst estimate is for net income of $1.19 per share, a rise of 3.5% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from $1.29. Between one and three months ago, the average estimate moved down. It has been unchanged at $1.19 during the last month. For the year, analysts are projecting profit of $5.10 per share, a rise of 14.6% from last year.
Past Earnings Performance: Last quarter, the company missed estimates by one cent, coming in at net income of $1.36 per share against an estimate of profit of. In the first quarter, the company also missed expectations.
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A Look Back: In the second quarter, profit fell 25.6% to $120.6 million ($1 a share) from $162 million ($1.31 a share) the year earlier, missing analyst expectations. Revenue rose 2.1% to $1.86 billion from $1.82 billion.
Stock Price Performance: Between September 27, 2012 and October 25, 2012, the stock price dropped $4.72 (-6.8%), from $69.38 to $64.66. The stock price saw one of its best stretches over the last year between November 29, 2011 and December 6, 2011, when shares rose for six straight days, increasing 12.8% (+$7.94) over that span. It saw one of its worst periods between August 16, 2012 and August 24, 2012 when shares fell for seven straight days, dropping 4.1% (-$2.93) over that span.
Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.6 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term.
The company is looking to get back on track with this earnings announcement after a profit drop last quarter snapped a positive string of results. Net income rose 32.7% in the third quarter of the last fiscal year, 9.2% in the fourth quarter of the last fiscal year and 26.9% in the first quarter before declining in the second quarter.
On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 27% in the third quarter of the last fiscal year, 15.7% in the fourth quarter of the last fiscal year and 10.5% in the first quarter before increasing again in the second quarter.
Analyst Ratings: There are nine out of 17 analysts surveyed (52.9%) rating BorgWarner a buy.
Wall St. Revenue Expectations: Analysts predict a rise of 1.7% in revenue from the year-earlier quarter to $1.82 billion.
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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)
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