Overview

• U.S. auto parts supplier's Q1 sales rose 1%, beating analyst expectations

• Adjusted EPS for Q1 beat consensus, up 12% year-over-year

• Company returned $185 mln to shareholders via buybacks and dividends

Outlook

• BorgWarner maintains 2026 net sales guidance at $14.0 bln to $14.3 bln

• Company expects 2026 adjusted EPS of $5.00 to $5.20

• BorgWarner sees 2026 adjusted operating margin of 10.7% to 10.9%

Result Drivers

• BATTERY ENERGY SYSTEMS WEAKNESS - Decline in Battery Energy Systems segment sales weighed on organic net sales

• COST CONTROLS - Improved adjusted operating margin attributed to continued focus on cost controls

• SHARE REPURCHASES - Higher adjusted EPS driven by increased operating income and lower share count from repurchases

Company press release: ID:nPn9RG7tKa

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q1 Sales	Beat	$3.53 bln	$3.49 bln (12 Analysts)
Q1 Adjusted EPS	Beat	$1.24	$1.17 (14 Analysts)
Q1 EPS		$1.16
Q1 Gross Margin		19.20%

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 9 "strong buy" or "buy", 8 "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 $67.00, about 17% above its May 5 closing price of $57.26

• The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 9 three months ago

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