MeritValue

BORGWARNER INC

BWAdata completeness 100%19 fiscal years on file

Data notes: no data for concept 'investmentsAtFairValue'; no data for concept 'netInvestmentIncome'

The thesis, from the filings

BORGWARNER INC earns about 7% on invested capital, below its ~9% cost of capital, and has bought back 10% of its shares over 5 years — no moat visible in the numbers. The estimate methods put fair value between $25.48 and $39.01 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$11.8B1$12.6B2$14.2B3$14.1B3$14.3B3
Net income$537M4$944M5$625M6$338M6$277M6
Operating cash flow$1.31B7$1.57B7$1.4B8$1.38B8$1.65B8
Capital expenditure$514M9$622M10$832M11$671M11$469M11
Free cash flow (derived)$792M7$947M7$565M8$711M8$1.18B8
Total debt$4.27B12$4.14B13$3.71B14$4.1B15$3.9B15
Cash & equivalents$1.84B16$1.34B17$1.53B17$2.09B17$2.31B17
Diluted shares239.5M236.8M234.4M224.8M216.4M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$251.48
your share of equity
Profit it earned you last year
$12.8
Free cash flow it threw off
$54.48
Debt you’d be carrying
$180.04

10 shares is a claim on $251.48 of net worth that earned you $12.8 and generated $54.48 of cash last year, against $180.04 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
7% avg · 5y
FY21 6%FY22 8%FY23 9%FY24 7%FY25 6%

It earned about 7% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
−10% shares · 5y

Share count is down 10% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has held roughly steady.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.5.0

The 3 estimate methods that apply put fair value between $25.48 and $39.01 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$35.54
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.0%
  • fcfBase$711M
DCF · Growth Exit 5Y
$39.01
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.0%
  • fcfBase$711M
Earnings Power Value
$25.48
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$537M
  • growthAssumed0.0%
Graham Number
$27.51
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years0.0%
Discount rate (WACC)9.02%
Terminal growth2.5%
At your growth, a share is worth $39.01
The three cases
Bear0.0%$39.01
Base0.0%$39.01
Bull5.0%$50.2

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 0.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000908255-24-000007 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000908255-25-000007 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0000908255-26-000011 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000908255-24-000007 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000908255-25-000007 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0000908255-26-000011 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000908255-23-000013 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2023-12-31 · accession 0000908255-26-000011 (NetCashProvidedByUsedInOperatingActivitiesContinuingOperations)
  9. 10-K · period ending 2021-12-31 · accession 0000908255-24-000007 (PaymentsToAcquireProductiveAssets)
  10. 10-K · period ending 2022-12-31 · accession 0000908255-25-000007 (PaymentsToAcquireProductiveAssets)
  11. 10-K · period ending 2023-12-31 · accession 0000908255-26-000011 (PaymentsToAcquireProductiveAssets)
  12. 10-K · period ending 2021-12-31 · accession 0000908255-23-000013 (LongTermDebtNoncurrent)
  13. 10-K · period ending 2022-12-31 · accession 0000908255-24-000007 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2023-12-31 · accession 0000908255-25-000007 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2024-12-31 · accession 0000908255-26-000011 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2021-12-31 · accession 0000908255-22-000009 (CashAndCashEquivalentsAtCarryingValue)
  17. 10-K · period ending 2022-12-31 · accession 0000908255-26-000011 (CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents)