BorgWarner (BWA) DIvidends Date & History

Key Takeaways

• BorgWarner (BWA) pays a quarterly dividend of $0.17 per share, totaling $0.68 annually for a current yield near 1.06%.
• The company lifted its dividend by 54.5% in mid-2025, marking a return to a $0.17 quarterly payout after a period of reduced payments.
• With a payout ratio of roughly 40% of earnings and just 11% of free cash flow, the dividend is well covered and appears highly sustainable.
• BorgWarner generated over $1.2 billion in free cash flow in 2025 and expects $900 million to $1.1 billion in 2026, providing ample coverage for shareholder returns.
• While the current yield is below the auto parts industry median, the recent dividend increase signals management's confidence in the company's cash generation.

Dividend Overview

BorgWarner (BWA) is a global leader in clean and efficient propulsion technologies for combustion, hybrid, and electric vehicles. The company currently pays a quarterly dividend of $0.17 per share, or $0.68 on an annualized basis, yielding approximately 1.06%. Dividends are paid four times per year, with the most recent ex-dividend date occurring on June 1, 2026, and payment on June 15, 2026. BorgWarner is best described as a modest-yield dividend stock with improving characteristics. While its yield remains below the broader auto parts sector average, the company has demonstrated a willingness to return capital to shareholders through both dividends and aggressive share repurchases, returning over $630 million to shareholders in 2025 alone.

Dividend History and Growth

BorgWarner has a long track record of paying dividends, extending back more than a decade. From 2017 through early 2023, the company maintained a steady quarterly dividend of $0.17 per share. However, in mid-2023, the company cut its quarterly payout to $0.11 per share — a reduction of roughly 35% — as it navigated a challenging transition in the automotive industry and reinvested capital into its electrification strategy. That reduced rate held for approximately two years. Then, in the third quarter of 2025, BorgWarner restored the dividend to $0.17 per share, representing a 54.5% year-over-year increase. This restored the dividend to its previous level and marked a meaningful turning point. Over the trailing twelve months, the total dividend per share stands at $0.68, up from $0.44 in 2024. While the five-year compound annual growth rate (CAGR) remains negative due to the mid-cycle cut, the recent increase signals renewed confidence in the company's financial trajectory.

Dividend Sustainability and Payout Ratio

BorgWarner's dividend appears comfortably sustainable on multiple fronts. The current payout ratio based on trailing twelve-month earnings is approximately 40%, meaning the company retains roughly 60% of its net income for reinvestment, debt reduction, or share buybacks. Even more encouraging is the free cash flow payout ratio, which stands at roughly 11% — indicating that BorgWarner pays out only about 11 cents of every dollar of free cash flow (FCF) as dividends. Free cash flow generation has been robust: the company reported over $1.2 billion in FCF in 2025, a 66% improvement year over year, and guided for $900 million to $1.1 billion in 2026. BorgWarner's balance sheet is investment-grade, and management has maintained a disciplined capital allocation framework, prioritizing organic investment, accretive mergers and acquisitions (M&A), and shareholder returns. The combination of a low cash payout ratio, strong FCF generation, and a manageable debt load provides a wide margin of safety for the current dividend.

Dividend Compared to Industry Peers

BorgWarner's dividend yield of roughly 1.06% sits below the auto parts industry median of approximately 2.2% to 2.3%. For context, larger peers such as MGA (Magna International) and LEA (Lear Corporation) offer yields in the range of 2.5% to 4%, while some smaller suppliers offer even higher yields. However, BorgWarner differentiates itself through a stronger growth profile and a more aggressive share repurchase program. The company's total shareholder yield — which combines dividends and net buybacks — stands at roughly 4.8%, placing it more competitively within its peer group on a total return of capital basis. Investors comparing yields should also note that BorgWarner's lower payout ratio provides greater flexibility for future dividend growth relative to higher-yielding peers that may be paying out a larger share of earnings.

AI Screener

Tickeron's AI Screener is an advanced, AI-powered stock and ETF discovery tool that helps traders and investors filter the market based on technical patterns, fundamentals, trends, volatility, and AI-driven signals. Users can scan thousands of stocks and ETFs using customizable filters such as industry, market capitalization, technical indicators, price patterns, and performance metrics. The screener is particularly useful for identifying dividend stocks, income-focused investments, trending stocks, breakout candidates, and market opportunities more efficiently than manual screening. Whether you are evaluating dividend sustainability, yield comparisons, or momentum signals, the AI Screener provides a data-rich, intuitive platform to streamline your research process.

Is This Stock Attractive for Dividend Investors?

BorgWarner presents a balanced profile that may appeal to a specific subset of dividend investors. For income-focused investors seeking high current yield, BWA's sub-1.1% payout is unlikely to satisfy. However, for dividend growth investors and total-return-oriented shareholders, the story is more compelling. The recent 54.5% dividend increase, combined with strong free cash flow generation and a conservative payout ratio, provides a credible foundation for future dividend growth. Long-term investors who believe in BorgWarner's strategic pivot toward electrification, hybrid propulsion, and its new data center and industrial energy storage business may find the modest dividend a complementary component of total return. Conservative investors should note that BorgWarner's dividend history includes a cut in 2023, which may be a concern for those requiring uninterrupted payment growth. Overall, BWA may be best suited for investors who prioritize capital appreciation and total shareholder return — including dividends and buybacks — over high standalone yield.

Disclaimer

The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.