BorgWarner Shares Popped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What:Motley Fool Stock Advisor pick BorgWarner (NYS: BWA) reported blowout earnings this morning, and shares responded by climbing 12% in intraday trading.

So what: Revenue was up 28% to $1.8 billion, and earnings per share reached $1.12, which crushed $0.99 estimates. In an industry under pressure from commodity prices and slow demand, BorgWarner is bucking the trend.

Now what: Management pointed to the increased demand for advanced powertrain technology and a focus on fuel economy as main drivers during the quarter, which resulted in organic sales growth of 15% compared with a 2% decline for the industry. Shares are pretty reasonably priced at 15 times forward earnings, and considering BorgWarner's momentum in the industry, I think shares have room to run.

Interested in more info on BorgWarner? Add it to your watchlist.

At the time thisarticle was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.Motley Fool newsletter services have recommended buying shares of BorgWarner. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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