BorgWarner (NYSE: BWA) will try to beat its earnings estimates for the fifth consecutive quarter. The company will unveil its latest earnings on Thursday, July 28. BorgWarner is a global supplier of engineered automotive systems and components, mainly for powertrain applications.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on BorgWarner, with eight of 15 analysts rating it hold. Analysts don't like BorgWarner as much as competitor Lear overall. Eleven out of 13 analysts rate Lear a buy, compared with seven of 15 for BorgWarner. Analysts still rate the stock a hold, but they are a bit more wary about it compared with three months ago.
  • Revenue forecasts: On average, analysts predict $1.74 billion in revenue this quarter. That would represent a rise of 22.5% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.98 per share. Estimates range from $0.85 to $1.15.

What our community says:
CAPS All-Stars are solidly behind the stock, with 95.5% awarding it an "outperform" rating. The community at large backs the All-Stars, with 92% granting it a rating of "outperform." Fools have embraced BorgWarner and haven't been shy with their opinions lately, logging 102 posts in the past 30 days. Despite the majority sentiment in favor of BorgWarner, the stock has a middling CAPS rating of three out of five stars.

Management:
BorgWarner's profit has risen year over year by an average of 91.3%.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter Q1 Q4 Q3 Q2
Gross Margin 19.8% 20% 19.4% 19.4%
Operating Margin 10.4% 10.3% 8.7% 8.3%
Net Margin 7.2% 7.3% 7.6% 5.8%
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