Vehicle component suppliers are undeniably cyclical, and the upcoming shift toward hybrids and EVs has created understandable worry about which suppliers will be left out in the cold. Even so, it has seemed for some time to me that BorgWarner (BWA) doesn't really get the credit it deserves. Not only have I seen bears try to wave away the company's multiyear streak of growth ahead of underlying global production (all but one quarter since 2017), they've simultaneously criticized BorgWarner's R&D and M&A investments into electrification while fretting about whether BorgWarner will have the technology to make the transition.
Up more than 40% since my last update on the company, it looks like some of the panic has eased off, but I continue to see upside from here. There are certainly other names in the space worthy of consideration - including Dana (DAN), Valeo (OTCPK:VLEEY), and motor developer Nidec (OTCPK:NJDCY) - but I continue to believe that BorgWarner offers enough prospective return from here to be worth consideration.
Read more here:
Quarter By Quarter, BorgWarner Wears Down The Bear Arguments
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