BWANEUTRAL

Gross Margin

19.2%

Higher than 24% of Consumer Cyclical sector peers

Updated 289h ago

Sector Performance

24th percentile

BWA

19.2%

Sector Median

36.3%

Sector Avg

30.6%

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Deep Analysis

Gross margin measures the percentage of revenue a company retains after deducting the direct costs of producing its goods—at 19.2%, BorgWarner keeps less than one-fifth of sales as gross profit, a relatively thin buffer.

This figure sits well below the Consumer Cyclical sector median of 36.3%, placing the company at the 24th percentile among peers, meaning three-quarters of sector rivals have higher gross margins. The year-over-year change is not available, but the quarter-over-quarter change of -5.9% shows a clear recent decline from the prior quarter’s 20.4% level. A gross margin that is both low compared to the sector and moving downward signals compressed pricing power or rising input costs, which increases investment risk by squeezing potential earnings. This combination of a sub-30% margin and a negative trend does not support a bullish case and instead reinforces caution. Given the overall NEUTRAL verdict on the stock, this metric aligns with a balanced view—it highlights a structural weakness that offsets any positive factors, justifying neither a buy nor sell recommendation.

Frequently Asked Questions

What does the Gross Margin tell investors about BWA?

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.

How is the Gross Margin calculated?

Gross Margin is calculated as: Gross Profit / Revenue.

How does BWA's Gross Margin compare to its sector?

BWA's Gross Margin of 19.2% compares to a Consumer Cyclical sector median of 36.3%, placing it in the 24th percentile.

Who are BWA's closest peers by Gross Margin?

The closest Consumer Cyclical peers by Gross Margin include: BABA (34.5%), ROST (29.6%), BBY (23.5%), BROS (23.1%), XPEV (20.6%).

The Formula

Gross Profit / Revenue

Why It Matters

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.