Volker Weng Takes Money Off The Table, Sells $664K In BorgWarner Stock

It was reported on August 26, that Volker Weng, Vice President at BorgWarner BWA executed a significant insider sell, according to an SEC filing.

What Happened: Weng's recent move involves selling 19,692 shares of BorgWarner. This information is documented in a Form 4 filing with the U.S. Securities and Exchange Commission on Monday. The total value is $664,339.

BorgWarner shares are trading up 0.06% at $33.83 at the time of this writing on Tuesday morning.

About BorgWarner

BorgWarner is a Tier I auto-parts supplier with three operating segments. The air management group makes turbochargers, e-boosters, e-turbos, timing systems, emissions systems, thermal systems, gasoline ignition technology, powertrain sensors, and cabin heaters. The drivetrain and battery systems group produces automatic transmission components, torque management products, battery heaters, battery charging, and battery modules. The e-propulsion segment makes e-motors, power electronics, and software and control modules. The company's largest customers are Ford and Volkswagen at 14% and 11% of 2023 revenue, respectively. Geographically, Europe accounted for 36% of 2023 revenue, while Asia and North America were 34% and 29% apiece.

BorgWarner: A Financial Overview

Revenue Challenges: BorgWarner's revenue growth over 3 months faced difficulties. As of 30 June, 2024, the company experienced a decline of approximately -1.85%. This indicates a decrease in top-line earnings. When compared to others in the Consumer Discretionary sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Insights into Profitability:

• Gross Margin: The company faces challenges with a low gross margin of 19.01%, suggesting potential difficulties in cost control and profitability compared to its peers.

• Earnings per Share (EPS): The company excels with an EPS that surpasses the industry average. With a current EPS of 1.34, BorgWarner showcases strong earnings per share.

Debt Management: BorgWarner's debt-to-equity ratio is below the industry average at 0.64, reflecting a lower dependency on debt financing and a more conservative financial approach.

Assessing Valuation Metrics:

• Price to Earnings (P/E) Ratio: The P/E ratio of 10.15 is lower than the industry average, implying a discounted valuation for BorgWarner's stock.

• Price to Sales (P/S) Ratio: With a P/S ratio of 0.55 below industry standards, the stock shows potential undervaluation, making it an appealing investment option for those focusing on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): The company's EV/EBITDA ratio 5.94 is below the industry average, indicating that it may be relatively undervalued compared to peers.

Market Capitalization Analysis: Above industry benchmarks, the company's market capitalization emphasizes a noteworthy size, indicative of a strong market presence.

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Why Insider Transactions Are Important

Insider transactions should be considered alongside other factors when making investment decisions, as they can offer important insights.

In the realm of legality, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities under Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are required to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

Notably, when a company insider makes a new purchase, it is considered an indicator of their positive expectations for the stock.

Conversely, insider sells may not necessarily signal a bearish stance on the stock and can be motivated by various factors.

Exploring Key Transaction Codes

Surveying the realm of stock transactions, investors often give prominence to those unfolding in the open market, systematically detailed in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C denotes the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of BorgWarner's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.