WAB vs ALSN

For growth investors, Westinghouse Air Brake Technologies Corporation (WAB) is the stronger pick with 7.

5% revenue growth year-over-year, versus -6. 7% for Allison Transmission Holdings, Inc. (ALSN). Allison Transmission Holdings, Inc. (ALSN) offers the better valuation at 16. 8x trailing P/E (14. 1x forward), making it the more compelling value choice. Analysts rate Westinghouse Air Brake Technologies Corporation (WAB) a "Buy" — based on 34 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, Allison Transmission Holdings, Inc.

(ALSN) is the cheapest at 16. 8x versus Westinghouse Air Brake Technologies Corporation at 38. 9x. On forward P/E, Allison Transmission Holdings, Inc. is actually cheaper at 14. 1x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Allison Transmission Holdings, Inc. wins at 0. 62x versus Westinghouse Air Brake Technologies Corporation's 0. 97x — a PEG below 1. 0 traditionally signals the market is underpricing earnings growth.

Over the past 5 years, Westinghouse Air Brake Technologies Corporation (WAB) delivered a total return of +229.

0%, compared to +183. 5% for Allison Transmission Holdings, Inc. (ALSN). Over 10 years, the gap is even starker: ALSN returned +377. 7% versus WAB's +247. 1%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), Allison Transmission Holdings, Inc.

(ALSN) is the lower-risk stock at 1. 08β versus Westinghouse Air Brake Technologies Corporation's 1. 11β — meaning WAB is approximately 3% more volatile than ALSN relative to the S&P 500. On balance sheet safety, Westinghouse Air Brake Technologies Corporation (WAB) carries a lower debt/equity ratio of 50% versus 156% for Allison Transmission Holdings, Inc. — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), Westinghouse Air Brake Technologies Corporation (WAB) is pulling ahead at 7.

5% versus -6. 7% for Allison Transmission Holdings, Inc. (ALSN). On earnings-per-share growth, the picture is similar: Westinghouse Air Brake Technologies Corporation grew EPS 13. 1% year-over-year, compared to -11. 8% for Allison Transmission Holdings, Inc.. Over a 3-year CAGR, WAB leads at 10. 1% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

Allison Transmission Holdings, Inc.

(ALSN) is the more profitable company, earning 20. 7% net margin versus 10. 5% for Westinghouse Air Brake Technologies Corporation — meaning it keeps 20. 7% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: ALSN leads at 32. 3% versus 16. 7% for WAB. At the gross margin level — before operating expenses — ALSN leads at 48. 4%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential.

By this metric, Allison Transmission Holdings, Inc. (ALSN) is the more undervalued stock at a PEG of 0. 62x versus Westinghouse Air Brake Technologies Corporation's 0. 97x. A PEG below 1. 0 is traditionally considered the threshold for growth-adjusted undervaluation. On forward earnings alone, Allison Transmission Holdings, Inc. (ALSN) trades at 14. 1x forward P/E versus 25. 0x for Westinghouse Air Brake Technologies Corporation — 11. 0x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for WAB: 9. 5% to $291. 00.

All stocks in this comparison pay dividends.

Allison Transmission Holdings, Inc. (ALSN) offers the highest yield at 0. 9%, versus 0. 4% for Westinghouse Air Brake Technologies Corporation (WAB).

For long-horizon retirement investors, Allison Transmission Holdings, Inc.

(ALSN) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 1. 08), 0. 9% yield, +377. 7% 10Y return). Both have compounded well over 10 years (ALSN: +377. 7%, WAB: +247. 1%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

These companies operate in different sectors (WAB (Industrials) and ALSN (Consumer Cyclical)), which means they face different economic cycles, regulatory environments, and macro sensitivities — making direct comparison nuanced.

In terms of investment character: WAB is a mid-cap quality compounder stock; ALSN is a mid-cap deep-value stock. ALSN pays a dividend while WAB does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.