Is BorgWarner, Inc. overvalued or undervalued?

As of 21 November 2025, the valuation grade for BorgWarner, Inc. has moved from fair to very expensive, indicating a significant shift in its perceived value. The company is currently overvalued based on its valuation ratios, which include a P/E ratio of 8, an EV to EBITDA of 5.44, and a Price to Book Value of 1.49. When compared to peers, BorgWarner's P/E ratio is notably lower than CNH Industrial NV's 19.42 and AGCO Corp.'s 14.36, highlighting its relative overvaluation in the market.
Despite a strong year-to-date return of 34.89% compared to the S&P 500's 12.26%, the long-term performance shows a concerning trend, with a 3-year return of 16.04% versus the S&P 500's 67.17%. This suggests that while BorgWarner has performed well recently, its valuation does not align with its long-term growth potential, reinforcing the conclusion that the stock is overvalued.