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Westinghouse Air Brake Technologies
(NYSE:WAB)
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Rating:81Outperform
Price Target:
$335.00
▲(10.74% Upside)
Action:Reiterated
Date:07/23/26
WAB scores well on strong financial performance (profitability improvements and excellent free cash flow) and a constructive earnings update with raised guidance and stronger backlog. Technicals also support the bullish setup with price above key moving averages. The key constraints on the score are a relatively expensive valuation (high P/E and low yield) and leverage trending higher.
Positive Factors
Strong cash generation
Sustained, high-quality cash generation (operating cash flow and free cash flow near $2B TTM) provides durable funding for capex, acquisitions, buybacks and dividends. Strong cash conversion reduces refinancing risk and supports strategic investments through business cycles without relying solely on external capital.
Negative Factors
Rising leverage
An uptick in leverage versus prior years reduces financial flexibility if growth softens. While leverage sits in the stated target band, higher debt levels mean interest and principal obligations absorb cash flow, limiting room for opportunistic investment or extended buybacks during downturns.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Sustained, high-quality cash generation (operating cash flow and free cash flow near $2B TTM) provides durable funding for capex, acquisitions, buybacks and dividends. Strong cash conversion reduces refinancing risk and supports strategic investments through business cycles without relying solely on external capital.
Read all positive factors
Westinghouse Air Brake Technologies Key Performance Indicators (KPIs)
Any
Operating Income by Segment
Reveals profitability across different business segments, highlighting which areas are driving earnings and where there might be challenges or opportunities for improvement.
Reveals profitability across different business segments, highlighting which areas are driving earnings and where there might be challenges or opportunities for improvement.
Data provided by:
The Fly
The FlyWestinghouse Air Brake Technologies (WAB) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$49.13B
Dividend Yield0.39%
Average Volume (3M)942.57K
Price to Earnings (P/E)39.0
Beta (1Y)1.02
Revenue Growth13.43%
EPS Growth10.75%
CountryUS
Employees31,000
SectorIndustrials
Sector Strength72
IndustryRailroads
Share Statistics
EPS (TTM)7.46
Shares Outstanding168,910,860
10 Day Avg. Volume1,225,664
30 Day Avg. Volume942,566
Financial Highlights & Ratios
PEG Ratio2.32
Price to Book (P/B)3.27
Price to Sales (P/S)3.26
P/FCF Ratio24.28
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$326.86Price Target Upside8.05% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)10.83
Revenue Forecast (FY)$12.51B
Westinghouse Air Brake Technologies Business Overview & Revenue Model
Company Description
Westinghouse Air Brake Technologies Corporation (WAB) delivers a comprehensive suite of advanced technological solutions, equipment, and services tailored for the global freight railway and urban mass transit sectors. Its operations are bifurcated...
How the Company Makes Money
Wabtec makes money by selling rail equipment and technology and by providing high-margin aftermarket parts and services over the life of rail assets. Its key revenue streams typically include: (1) Original equipment sales (OE): revenue from manufa...
Westinghouse Air Brake Technologies Earnings Call Summary
Earnings Call Date:Jul 22, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Positive
The call presented multiple strong operational and financial takeaways — robust top‑line growth (Q2 sales +17.5%), margin expansion, substantial backlog growth, strong cash generation, notable commercial wins and an upward revision to full‑year revenue and EPS guidance. These positives were tempered by persistent external headwinds (tariffs, inflation, chip shortages), softer services/modernization in H1, a small decline in components related to a weaker North American railcar build, and some acquisition‑related charges and higher SG&A/engineering spend. On balance, the momentum in revenue, margins, backlog and guidance outweigh the identified challenges.Positive Updates
Strong Revenue and Organic Growth
Q2 sales of $3.18 billion, up 17.5% year-over-year (16.6% ex-currency). Organic growth contributed ~8.5% of Q2 growth and H1 organic growth was 5.5%.
Negative Updates
Tariff, Inflation and Supply‑Chain Headwinds
Company cited tariff‑related headwinds and rising manufacturing costs, along with chip shortages affecting electronics. Tariffs and inflationary pressures remain a drag and were specifically called out as partially offsetting margin gains.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Revenue and Organic Growth
Q2 sales of $3.18 billion, up 17.5% year-over-year (16.6% ex-currency). Organic growth contributed ~8.5% of Q2 growth and H1 organic growth was 5.5%.
Read all positive updates
Company Guidance
Wabtec raised its 2026 outlook to roughly $12.5 billion of revenue at the midpoint (up 11.5% year‑over‑year and +1 percentage point vs. prior guidance, ~+$110 million) and adjusted EPS of $10.60–$10.90 (midpoint $10.75, about +20% YoY and a $0.30 midpoint increase), citing strong Q2 results — $3.18B sales (+17.5% YoY; +16.6% ex‑FX), adjusted EPS $2.76 (+21.6% YoY), $441M operating cash flow (82% cash conversion) — and a healthy backlog (12‑month backlog up ~11%, multi‑year backlog >$30B, +42%). Management expects H2 revenue growth to moderate as they lap Inspection Technologies, with revenue slightly stronger in Q3 than Q4 but the majority of margin expansion coming in Q4 as tariff headwinds temper and Integration 3.0/productivity and portfolio optimization benefit results; net debt leverage remains near 2.2x (target 2.0–2.5x).Westinghouse Air Brake Technologies Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
71
Positive
Cash Flow
86
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 11.98B | 11.17B | 10.39B | 9.68B | 8.36B | 7.82B |
| Gross Profit | 4.11B | 3.52B | 3.37B | 2.94B | 2.54B | 2.37B |
| EBITDA | 2.45B | 2.32B | 2.07B | 1.79B | 1.47B | 1.35B |
| Net Income | 1.27B | 1.17B | 1.06B | 815.00M | 633.00M | 558.00M |
Balance Sheet | ||||||
| Total Assets | 23.13B | 22.07B | 18.70B | 18.99B | 18.52B | 18.45B |
| Cash, Cash Equivalents and Short-Term Investments | 670.00M | 789.00M | 706.00M | 620.00M | 541.00M | 473.00M |
| Total Debt | 6.94B | 5.54B | 3.98B | 4.07B | 4.00B | 4.06B |
| Total Liabilities | 11.88B | 10.88B | 8.57B | 8.46B | 8.37B | 8.21B |
| Stockholders Equity | 11.24B | 11.14B | 10.09B | 10.49B | 10.10B | 10.20B |
Cash Flow | ||||||
| Free Cash Flow | 1.85B | 1.50B | 1.63B | 1.01B | 889.00M | 943.00M |
| Operating Cash Flow | 2.00B | 1.76B | 1.83B | 1.20B | 1.04B | 1.07B |
| Investing Cash Flow | -3.81B | -2.75B | -343.00M | -492.00M | -235.00M | -540.00M |
| Financing Cash Flow | 985.00M | 1.03B | -1.37B | -633.00M | -708.00M | -653.00M |
Westinghouse Air Brake Technologies Risk Analysis
Westinghouse Air Brake Technologies disclosed 30 risk factors in its most recent earnings report. Westinghouse Air Brake Technologies reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Westinghouse Air Brake Technologies Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $49.13B | 39.04 | 11.36% | 0.37% | 13.43% | 10.75% | |
69 Neutral | $173.55B | 23.62 | 38.65% | 1.80% | 4.17% | 7.24% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
61 Neutral | $430.17M | 37.73 | 6.39% | ― | 11.73% | -68.10% | |
59 Neutral | $1.52B | 14.23 | 6.57% | 2.53% | -25.64% | -52.74% | |
58 Neutral | $2.49B | 7.27 | 31.91% | 3.29% | -18.95% | 260.48% | |
52 Neutral | $261.22M | 8.86 | 21.95% | ― | -4.92% | ― |
* Industrials Sector Average
WAB
Westinghouse Air Brake Technologies
299.07
111.11
59.11%
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8.54
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41.87
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84.77%
TRN
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32.04
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26.55%
UNP
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296.35
78.33
35.93%
Westinghouse Air Brake Technologies Corporate Events
Business Operations and StrategyFinancial Disclosures
Wabtec Reports Strong Second Quarter 2026 Financial Results
Positive
Jul 22, 2026
On July 22, 2026, Wabtec reported strong second quarter 2026 results, with sales rising 17.5% year on year to $3.18 billion and cash from operations more than doubling to $441 million. GAAP diluted earnings per share increased 18.9% to $2.33, whil...
Executive/Board ChangesShareholder Meetings
Westinghouse Air Brake Shareholders Back Board, Pay, Auditor
Positive
May 15, 2026
At its 2026 Annual Meeting of Stockholders held on May 12, 2026, Westinghouse Air Brake Technologies shareholders elected three directors, Rafael Santana, Lee C. Banks and Byron S. Foster, to new three-year terms expiring in 2029, with each nomine...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.