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Westinghouse Air Brake Technologies (WAB)
NYSE:WAB
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Westinghouse Air Brake Technologies (WAB) AI Stock Analysis

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WAB

Westinghouse Air Brake Technologies

(NYSE:WAB)

Rating:74Outperform
Price Target:
$219.00
▲(11.88% Upside)
Westinghouse Air Brake Technologies' strong financial performance and positive earnings call outlook are the most significant factors driving the score. The company's strategic acquisitions and increased guidance reflect confidence in future growth. However, the high P/E ratio and mixed technical indicators suggest caution. Supply chain challenges and a reduced railcar forecast are notable risks, but the company's strategic positioning and operational execution provide a solid foundation for future performance.
Positive Factors
Acquisition
The acquisition of Dellner Couplers strengthens WAB's Transit product portfolio and financial profile.
Market Position
Strategically, this acquisition positions Wabtec as the leading producer of transit market couplers globally.
Revenue Growth
Revenue increased by 5% year-over-year, surpassing estimates, indicating strong performance.
Negative Factors
Freight Segment
A sequential Freight margin deterioration is expected in the second quarter.

Westinghouse Air Brake Technologies (WAB) vs. SPDR S&P 500 ETF (SPY)

Westinghouse Air Brake Technologies Business Overview & Revenue Model

Company DescriptionWestinghouse Air Brake Technologies Corporation (WAB) is a leading global provider of technology-based products and services for the freight and transit rail industries. The company operates in several sectors, including freight rail, transit systems, and aftermarket services. WAB specializes in the design and manufacture of a wide range of products, including braking systems, electronic controls, and positive train control systems, as well as providing services that enhance the safety and efficiency of rail operations.
How the Company Makes MoneyWestinghouse Air Brake Technologies generates revenue primarily through the sale of its core products, which include advanced braking systems and electronic control solutions for both freight and transit applications. Key revenue streams come from original equipment manufacturing (OEM) sales, where WAB supplies components for new rail vehicles, and aftermarket services, which include maintenance, repair, and replacement parts for existing systems. The company also benefits from long-term contracts and service agreements with major rail operators, which ensure a steady income flow. Strategic partnerships with rail operators and other industry stakeholders further enhance WAB's market position and contribute to its earnings through collaborative projects and joint ventures.

Westinghouse Air Brake Technologies Key Performance Indicators (KPIs)

Any
Any
Revenue by Product Line
Revenue by Product Line
Shows how much revenue each product line generates, indicating which products are most successful and where there might be potential for growth or need for strategic adjustments.
Chart InsightsWabtec's Services and Equipment lines show fluctuating trends, with Services peaking in late 2023 and Equipment recovering in mid-2024. The earnings call highlights strong financial performance and strategic acquisitions, boosting confidence despite supply chain challenges. The acquisition of Inspection Technologies is expected to enhance revenue and EBITDA significantly. However, supply delays and a reduced forecast for North American railcar builds pose risks. The positive outlook and increased guidance reflect management's confidence in overcoming these hurdles and achieving growth.
Data provided by:Main Street Data

Westinghouse Air Brake Technologies Earnings Call Summary

Earnings Call Date:Jul 24, 2025
(Q2-2025)
|
% Change Since: -8.58%|
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Positive
The earnings call reflected a positive outlook with strong financial performance, significant backlog growth, and successful strategic acquisitions. However, supply chain issues and a reduction in the railcar forecast were notable challenges.
Q2-2025 Updates
Positive Updates
Adjusted EPS Growth
Adjusted earnings per share increased by 16% from the previous year, demonstrating strong financial performance amidst economic volatility.
12-Month Backlog Increase
The 12-month backlog reached $8.2 billion, up 11.9%, indicating strong demand and visibility for future operations.
Successful Acquisitions
Acquisitions of Inspection Technologies, DeLiner Couplers, and Frauscher Sensor Technology are expected to deliver accretive growth, with $850 million in annualized revenues and a 25.5% EBITDA margin.
Transit Segment Growth
The Transit segment saw sales increase by 8.7%, driven by elevated infrastructure investment and global ridership.
Improved Operating Margin
Adjusted operating margin improved by 1.8 percentage points to 21.1%, driven by cost management and favorable product mix.
Negative Updates
Supply Chain Challenges
A supply part issue delayed locomotive shipments, impacting Q2 revenues by approximately $60 million.
Decrease in Equipment Sales
Equipment sales decreased by 4.2% due to supply chain issues and a reduced North America railcar build.
Reduced Railcar Forecast
The North American railcar build forecast was reduced from 35,000 to approximately 29,000 cars, a 31% reduction from last year.
Company Guidance
During the Wabtec Second Quarter 2025 Earnings Conference Call, the company highlighted several key metrics reflecting its strong financial performance and strategic progress. Notably, sales for the second quarter reached $2.7 billion, marking a 2% increase. Adjusted earnings per share (EPS) saw a significant rise of 16% compared to the same quarter last year. The company also reported a total cash flow from operations of $209 million. Wabtec's 12-month backlog increased to $8.2 billion, up 11.9%, showcasing strong momentum and visibility into future performance. In terms of acquisitions, Wabtec committed $3.5 billion to acquire three high-quality businesses, expected to deliver accretive growth and margins. The acquisitions are projected to generate first-year annualized revenues of $850 million, with an expected EBITDA of $217 million at a margin of 25.5%. Looking ahead, Wabtec increased its full-year 2025 guidance, anticipating sales of approximately $11.1 billion and an adjusted EPS between $8.55 and $9.15, up 17% at the midpoint.

Westinghouse Air Brake Technologies Financial Statement Overview

Summary
Westinghouse Air Brake Technologies shows strong financial health with consistent revenue growth, solid profitability, and effective cash flow management. The company manages its leverage well and efficiently utilizes equity, positioning it strongly within the Railroads industry. Despite minor fluctuations in free cash flow growth, overall financial performance remains robust.
Income Statement
85
Very Positive
Westinghouse Air Brake Technologies shows a strong financial performance with consistent revenue growth, achieving a 22.5% increase from 2022 to TTM (Trailing-Twelve-Months). The company maintains solid profitability with a net profit margin of 13.05% in TTM. Gross profit margin is stable at 32.6%, and EBITDA margin has improved to 18.38%. These metrics indicate effective cost management and profitability within the Railroads industry.
Balance Sheet
78
Positive
The balance sheet reflects a healthy financial position with a debt-to-equity ratio of 0.44 in TTM, indicating manageable leverage. The equity ratio stands at 52.96%, suggesting a solid equity base compared to total assets. Return on equity has improved to 12.76%, highlighting efficient use of equity in generating profits. Despite a slight increase in total debt over the years, the company's strong equity base supports financial stability.
Cash Flow
80
Positive
The cash flow analysis reveals strong liquidity with an operating cash flow to net income ratio of 1.21 in TTM, indicating robust cash generation relative to net income. The free cash flow to net income ratio is 1.05, reflecting efficient conversion of earnings into free cash flow. The slight decline in free cash flow growth to -10.76% from 2023 to TTM suggests cautious capital allocation, but overall cash flow management remains effective.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue10.56B10.39B9.68B8.36B7.82B7.56B
Gross Profit3.44B3.37B2.94B2.29B2.13B1.90B
EBITDA2.07B1.61B1.79B1.52B1.41B1.23B
Net Income1.15B1.06B815.00M633.00M558.00M414.00M
Balance Sheet
Total Assets20.39B18.70B18.99B18.52B18.45B18.45B
Cash, Cash Equivalents and Short-Term Investments1.49B706.00M620.00M541.00M473.00M599.00M
Total Debt4.78B3.98B4.07B4.00B4.06B4.24B
Total Liabilities9.55B8.57B8.46B8.37B8.21B8.30B
Stockholders Equity10.80B10.09B10.49B10.10B10.20B10.12B
Cash Flow
Free Cash Flow1.45B1.63B1.01B889.00M943.00M647.30M
Operating Cash Flow1.67B1.83B1.20B1.04B1.07B783.70M
Investing Cash Flow-384.00M-343.00M-492.00M-235.00M-540.00M-155.40M
Financing Cash Flow-394.00M-1.37B-633.00M-708.00M-653.00M-619.00M

Westinghouse Air Brake Technologies Technical Analysis

Technical Analysis Sentiment
Positive
Last Price195.74
Price Trends
50DMA
201.12
Negative
100DMA
195.11
Positive
200DMA
194.26
Positive
Market Momentum
MACD
-2.41
Negative
RSI
51.23
Neutral
STOCH
61.72
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WAB, the sentiment is Positive. The current price of 195.74 is above the 20-day moving average (MA) of 191.08, below the 50-day MA of 201.12, and above the 200-day MA of 194.26, indicating a neutral trend. The MACD of -2.41 indicates Negative momentum. The RSI at 51.23 is Neutral, neither overbought nor oversold. The STOCH value of 61.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WAB.

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

Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
80
Outperform
$135.12B19.7942.35%2.35%1.06%8.13%
79
Outperform
$63.85B19.2324.11%1.90%0.71%86.84%
74
Outperform
$33.46B29.2110.84%0.49%3.38%17.21%
71
Outperform
$1.47B6.6716.16%2.61%0.71%84.57%
64
Neutral
$2.34B25.2310.47%4.07%-22.95%-40.67%
58
Neutral
HK$14.10B4.53-3.70%5.60%2.27%-65.55%
46
Neutral
$171.76M156.43%-6.00%-12.45%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
WAB
Westinghouse Air Brake Technologies
195.74
31.31
19.04%
RAIL
Freightcar America
8.98
2.40
36.47%
GBX
Greenbrier
47.49
1.17
2.53%
NSC
Norfolk Southern
284.60
47.45
20.01%
TRN
Trinity Industries
29.00
-2.23
-7.14%
UNP
Union Pacific
227.85
-14.45
-5.96%

Westinghouse Air Brake Technologies Corporate Events

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Wabtec Reports Strong Q2 2025 Earnings Growth
Positive
Jul 24, 2025

On July 24, 2025, Wabtec Corporation reported its second quarter results for 2025, highlighting a 19.5% increase in GAAP diluted earnings per share and a 15.8% rise in adjusted diluted earnings per share compared to the previous year. The company also raised its adjusted EPS guidance for the fiscal year 2025, driven by strong performance in the first half, strategic mergers and acquisitions, and effective cost management. Despite challenges such as lower locomotive deliveries due to supply issues, Wabtec achieved sales growth and margin expansion, reflecting its robust operational execution and commitment to shareholder returns.

M&A TransactionsBusiness Operations and Strategy
Wabtec Completes Acquisition of Evident’s Inspection Division
Positive
Jul 1, 2025

On July 1, 2025, Wabtec Corporation completed the acquisition of Evident’s Inspection Technologies division, a leader in Non-Destructive Testing and Remote Visual Inspection solutions. This strategic acquisition enhances Wabtec’s Digital Intelligence business, doubling its total addressable market to $16 billion and expanding its reach into high-growth markets. The acquisition is expected to accelerate Wabtec’s growth, improve financial metrics, and provide immediate shareholder value.

Private Placements and FinancingBusiness Operations and Strategy
Westinghouse Air Brake Technologies Completes $1.25 Billion Note Offering
Positive
May 29, 2025

On May 29, 2025, Westinghouse Air Brake Technologies Corporation completed a public offering of $1.25 billion in senior notes, with $500 million due in 2030 and $750 million due in 2035. This financial move is expected to impact the company’s operations by enhancing its liquidity and financial flexibility, positioning it strategically within the industry, and potentially affecting stakeholders through changes in debt structure and financial obligations.

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.Date of analysis: Aug 23, 2025