WABTEC CORP (WAB)
US9297401088 - Common Stock
We assign a fundamental rating of 6 out of 10 to WAB. WAB was compared to 132 industry peers in the Machinery industry. While WAB belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. WAB has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
WAB had positive earnings in the past year.
In the past year WAB had a positive cash flow from operations.
Each year in the past 5 years WAB has been profitable.
WAB had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
WAB has a better Return On Assets (5.68%) than 63.08% of its industry peers.
WAB has a Return On Equity (10.33%) which is in line with its industry peers.
With a decent Return On Invested Capital value of 8.48%, WAB is doing good in the industry, outperforming 62.31% of the companies in the same industry.
WAB had an Average Return On Invested Capital over the past 3 years of 5.70%. This is significantly below the industry average of 10.90%.
The 3 year average ROIC (5.70%) for WAB is below the current ROIC(8.48%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.68% | ||
| ROE | 10.33% | ||
| ROIC | 8.48% |
ROA(3y)3.57%
ROA(5y)2.94%
ROE(3y)6.5%
ROE(5y)5.37%
ROIC(3y)5.7%
ROIC(5y)4.92%
1.3 Margins
The Profit Margin of WAB (10.25%) is better than 73.85% of its industry peers.
WAB's Profit Margin has improved in the last couple of years.
WAB has a better Operating Margin (16.31%) than 79.23% of its industry peers.
In the last couple of years the Operating Margin of WAB has grown nicely.
WAB has a Gross Margin (32.86%) which is in line with its industry peers.
WAB's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.31% | ||
| PM (TTM) | 10.25% | ||
| GM | 32.86% |
OM growth 3Y9.44%
OM growth 5Y5.45%
PM growth 3Y15.48%
PM growth 5Y4.5%
GM growth 3Y3.23%
GM growth 5Y1.93%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so WAB is destroying value.
The number of shares outstanding for WAB has been reduced compared to 1 year ago.
Compared to 5 years ago, WAB has more shares outstanding
The debt/assets ratio for WAB has been reduced compared to a year ago.
2.2 Solvency
WAB has an Altman-Z score of 3.75. This indicates that WAB is financially healthy and has little risk of bankruptcy at the moment.
WAB has a better Altman-Z score (3.75) than 60.77% of its industry peers.
The Debt to FCF ratio of WAB is 2.52, which is a good value as it means it would take WAB, 2.52 years of fcf income to pay off all of its debts.
WAB has a better Debt to FCF ratio (2.52) than 75.38% of its industry peers.
A Debt/Equity ratio of 0.34 indicates that WAB is not too dependend on debt financing.
WAB has a Debt to Equity ratio (0.34) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 2.52 | ||
| Altman-Z | 3.75 |
ROIC/WACC0.95
WACC8.91%
2.3 Liquidity
A Current Ratio of 1.30 indicates that WAB should not have too much problems paying its short term obligations.
WAB's Current ratio of 1.30 is on the low side compared to the rest of the industry. WAB is outperformed by 85.38% of its industry peers.
A Quick Ratio of 0.65 indicates that WAB may have some problems paying its short term obligations.
With a Quick ratio value of 0.65, WAB is not doing good in the industry: 88.46% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.3 | ||
| Quick Ratio | 0.65 |
3. Growth
3.1 Past
WAB shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 29.88%, which is quite impressive.
The Earnings Per Share has been growing by 9.08% on average over the past years. This is quite good.
Looking at the last year, WAB shows a quite strong growth in Revenue. The Revenue has grown by 9.23% in the last year.
Measured over the past years, WAB shows a quite strong growth in Revenue. The Revenue has been growing by 17.27% on average per year.
EPS 1Y (TTM)29.88%
EPS 3Y16.3%
EPS 5Y9.08%
EPS Q2Q%17.65%
Revenue 1Y (TTM)9.23%
Revenue growth 3Y8.6%
Revenue growth 5Y17.27%
Sales Q2Q%4.43%
3.2 Future
WAB is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.43% yearly.
WAB is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.95% yearly.
EPS Next Y29.88%
EPS Next 2Y20.49%
EPS Next 3Y18.32%
EPS Next 5Y16.43%
Revenue Next Year8.3%
Revenue Next 2Y7.18%
Revenue Next 3Y6.8%
Revenue Next 5Y6.95%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
WAB is valuated quite expensively with a Price/Earnings ratio of 26.12.
Compared to the rest of the industry, the Price/Earnings ratio of WAB is on the same level as its industry peers.
WAB is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.73, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 22.42, the valuation of WAB can be described as rather expensive.
WAB's Price/Forward Earnings is on the same level as the industry average.
When comparing the Price/Forward Earnings ratio of WAB to the average of the S&P500 Index (22.83), we can say WAB is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.12 | ||
| Fwd PE | 22.42 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as WAB.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of WAB indicates a somewhat cheap valuation: WAB is cheaper than 69.23% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.78 | ||
| EV/EBITDA | 16.57 |
4.3 Compensation for Growth
WAB's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of WAB may justify a higher PE ratio.
WAB's earnings are expected to grow with 18.32% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.87
PEG (5Y)2.88
EPS Next 2Y20.49%
EPS Next 3Y18.32%
5. Dividend
5.1 Amount
WAB has a yearly dividend return of 0.42%, which is pretty low.
Compared to an average industry Dividend Yield of 1.69, WAB has a dividend in line with its industry peers.
With a Dividend Yield of 0.42, WAB pays less dividend than the S&P500 average, which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.42% |
5.2 History
The dividend of WAB is nicely growing with an annual growth rate of 7.39%!
WAB has paid a dividend for at least 10 years, which is a reliable track record.
WAB has decreased its dividend recently.
Dividend Growth(5Y)7.39%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
WAB pays out 12.94% of its income as dividend. This is a sustainable payout ratio.
WAB's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP12.94%
EPS Next 2Y20.49%
EPS Next 3Y18.32%
WABTEC CORP
NYSE:WAB (12/20/2024, 8:04:00 PM)
After market: 193.03 0 (0%)193.03
+3.47 (+1.83%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners93.49%
Inst Owner Change-2.75%
Ins Owners1.03%
Ins Owner Change-0.77%
Market Cap33.18B
Analysts78.75
Price Target213.19 (10.44%)
Short Float %1.28%
Short Ratio2.16
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.42% |
Dividend Growth(5Y)7.39%
DP12.94%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.72%
Min EPS beat(2)3.01%
Max EPS beat(2)4.42%
EPS beat(4)3
Avg EPS beat(4)7.49%
Min EPS beat(4)-3.36%
Max EPS beat(4)25.9%
EPS beat(8)7
Avg EPS beat(8)7.09%
EPS beat(12)9
Avg EPS beat(12)4.71%
EPS beat(16)12
Avg EPS beat(16)3.99%
Revenue beat(2)0
Avg Revenue beat(2)-1.5%
Min Revenue beat(2)-2.06%
Max Revenue beat(2)-0.94%
Revenue beat(4)2
Avg Revenue beat(4)0.21%
Min Revenue beat(4)-2.06%
Max Revenue beat(4)3.14%
Revenue beat(8)6
Avg Revenue beat(8)2.35%
Revenue beat(12)6
Avg Revenue beat(12)0.34%
Revenue beat(16)7
Avg Revenue beat(16)-0.09%
PT rev (1m)12.7%
PT rev (3m)15.33%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.78%
EPS NY rev (1m)-0.07%
EPS NY rev (3m)2.02%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.74%
Revenue NY rev (1m)0.12%
Revenue NY rev (3m)-0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.12 | ||
| Fwd PE | 22.42 | ||
| P/S | 3.21 | ||
| P/FCF | 20.78 | ||
| P/OCF | 18.46 | ||
| P/B | 3.24 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.57 |
EPS(TTM)7.39
EY3.83%
EPS(NY)8.61
Fwd EY4.46%
FCF(TTM)9.29
FCFY4.81%
OCF(TTM)10.45
OCFY5.42%
SpS60.1
BVpS59.63
TBVpS-8.91
PEG (NY)0.87
PEG (5Y)2.88
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.68% | ||
| ROE | 10.33% | ||
| ROCE | 11.26% | ||
| ROIC | 8.48% | ||
| ROICexc | 8.72% | ||
| ROICexgc | 45.79% | ||
| OM | 16.31% | ||
| PM (TTM) | 10.25% | ||
| GM | 32.86% | ||
| FCFM | 15.46% |
ROA(3y)3.57%
ROA(5y)2.94%
ROE(3y)6.5%
ROE(5y)5.37%
ROIC(3y)5.7%
ROIC(5y)4.92%
ROICexc(3y)5.91%
ROICexc(5y)5.11%
ROICexgc(3y)34.13%
ROICexgc(5y)30.05%
ROCE(3y)7.56%
ROCE(5y)6.54%
ROICexcg growth 3Y17.97%
ROICexcg growth 5Y29.17%
ROICexc growth 3Y19.72%
ROICexc growth 5Y5.35%
OM growth 3Y9.44%
OM growth 5Y5.45%
PM growth 3Y15.48%
PM growth 5Y4.5%
GM growth 3Y3.23%
GM growth 5Y1.93%
F-Score8
Asset Turnover0.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 2.52 | ||
| Debt/EBITDA | 1.58 | ||
| Cap/Depr | 37.38% | ||
| Cap/Sales | 1.94% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 80.95% | ||
| Profit Quality | 150.8% | ||
| Current Ratio | 1.3 | ||
| Quick Ratio | 0.65 | ||
| Altman-Z | 3.75 |
F-Score8
WACC8.91%
ROIC/WACC0.95
Cap/Depr(3y)30.87%
Cap/Depr(5y)33.52%
Cap/Sales(3y)1.79%
Cap/Sales(5y)1.89%
Profit Quality(3y)144.86%
Profit Quality(5y)169.23%
High Growth Momentum
Growth
EPS 1Y (TTM)29.88%
EPS 3Y16.3%
EPS 5Y9.08%
EPS Q2Q%17.65%
EPS Next Y29.88%
EPS Next 2Y20.49%
EPS Next 3Y18.32%
EPS Next 5Y16.43%
Revenue 1Y (TTM)9.23%
Revenue growth 3Y8.6%
Revenue growth 5Y17.27%
Sales Q2Q%4.43%
Revenue Next Year8.3%
Revenue Next 2Y7.18%
Revenue Next 3Y6.8%
Revenue Next 5Y6.95%
EBIT growth 1Y28.14%
EBIT growth 3Y18.85%
EBIT growth 5Y23.66%
EBIT Next Year38.26%
EBIT Next 3Y17.56%
EBIT Next 5Y14.75%
FCF growth 1Y97.6%
FCF growth 3Y16.18%
FCF growth 5Y35.6%
OCF growth 1Y90.83%
OCF growth 3Y15.29%
OCF growth 5Y30.72%