Westinghouse Air Brake Technologies Corporation (WAB)
Valuation Overview•Is Westinghouse Air Brake Technologies Corporation Overvalued or Undervalued?
Priced at a premium to peer multiples and intrinsic cash flows, demanding strong execution to justify current levels.
Moderate quality score of 62/100, reflecting stable operating margins and manageable leverage.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Solid fundamental quality, though profitability presents a headwind.
Wall Street is broadly bullish, projecting solid upside alongside robust expected earnings growth. However, capital return yields remain modest, driven predominantly by aggressive share repurchases.
WAB demonstrates adequate business quality with stable profitability. This is paired with a moderately leveraged but stable balance sheet.
The company demonstrates solid revenue growth (10.1% 3Y CAGR) paired with highly explosive earnings growth (25.4% EPS 3Y CAGR). The company maintains healthy operational efficiency with a 16.1% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $3.0B | +7.5% | +10.1% | +8.1% | +12.9% | |
| EBITDA | $604.0M | — | +18.1% | — | — | |
| Net Income | $362.0M | +10.8% | +22.7% | — | +11.4% | |
| EPS (Diluted) | $2.12 | +13.1% | +25.4% | +25.8% | +5.2% | |
| Free Cash Flow | $153.0M | -7.9% | +19.0% | +18.3% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 33.8% | 31.4% | 31.0% | 29.8% |
| Operating Margin | 16.1% | 15.1% | 13.7% | 12.4% |
| Net Margin | 10.5% | 9.7% | 8.8% | 7.7% |
| FCF Margin | 14.3% | 13.2% | 12.5% | 10.2% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $2.51 | $2.71 | +8.0% | ||
| Q1'26 | $2.08 | $2.10 | +1.0% | ||
| Q4'25 | $2.28 | $2.32 | +1.8% | ||
| Q3'25 | $2.17 | $1.96 | -9.7% | ||
| Q2'25 | $2.03 | $2.28 | +12.3% | ||
| Q1'25 | $1.74 | $1.68 | -3.4% | ||
| Q4'24 | $1.90 | $2.00 | +5.3% | ||
| Q3'24 | $1.88 | $1.96 | +4.3% |
Total return is +36.9% (1Y), outperforming the benchmark by +11.9%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +26.9% | +17.6% | — |
| 1Y | +36.9% | +11.9% | +0.6% |
| 3YCAGR | +39.5% | +19.6% | +2.7% |
| 5YCAGR | +29.0% | +16.3% | +5.1% |
| 10YCAGR | +14.3% | +0.7% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Westinghouse Air Brake Technologies Corporation (WAB) valuation, health, and returns.
Westinghouse Air Brake Technologies Corporation is estimated to be overvalued under our discounted cash flow framework. relative multiples indicate the stock is Expensive versus peers compared to industry peers. overvalued (implying -47.7% downside from DCF intrinsic value of $143.15)
Westinghouse Air Brake Technologies Corporation has multiple valuation anchors: DCF Intrinsic Value: $143.15 | Peer Relative Fair Value: $197.20 | Wall Street Analyst Target: $305.00 (implying +11.4% upside). A convergence of these signals offers higher conviction.
Westinghouse Air Brake Technologies Corporation displays good financial health with a composite quality score of 62/100, supported by a Altman Z-Score of 3.3 (safe zone), Piotroski F-Score of 5/9, Return on Invested Capital (ROIC) of 9.6%.
Westinghouse Air Brake Technologies Corporation pays a 0.4% dividend yield, covered by a 15% payout ratio with 4 years of growth, supplemented by a 0.5% buyback yield.
Westinghouse Air Brake Technologies Corporation's current growth trajectory is Decelerating. The company achieved +7.5% 1Y revenue growth and +13.1% 1Y EPS growth, compared to its 3Y revenue CAGR of +10.1%.
Wall Street consensus is Buy based on 34 analysts, beating EPS expectations in 75% of recent quarters with a 3-quarter streak. The consensus price target represents a +11.4% change from current levels.
Investment risks for Westinghouse Air Brake Technologies Corporation include: -13.4% 1-year max drawdown. Volatility risk is characterized by a beta of 1.08x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.