WABTEC CORP (WAB) Stock Fundamental Analysis
NYSE:WAB - New York Stock Exchange, Inc. - US9297401088 - Common Stock - Currency: USD
WAB gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 128 industry peers in the Machinery industry. While WAB has a great profitability rating, 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.
WAB had a positive operating cash flow in the past year.
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 Return On Assets of 5.65%. This is in the better half of the industry: WAB outperforms 60.80% of its industry peers.
WAB has a Return On Equity (10.46%) which is in line with its industry peers.
WAB has a Return On Invested Capital of 8.45%. This is in the better half of the industry: WAB outperforms 60.80% of its industry peers.
WAB had an Average Return On Invested Capital over the past 3 years of 6.98%. This is below the industry average of 11.00%.
The last Return On Invested Capital (8.45%) for WAB is above the 3 year average (6.98%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.65% | ||
| ROE | 10.46% | ||
| ROIC | 8.45% |
ROA(3y)4.45%
ROA(5y)3.72%
ROE(3y)8.17%
ROE(5y)6.81%
ROIC(3y)6.98%
ROIC(5y)5.93%
1.3 Margins
Looking at the Profit Margin, with a value of 10.17%, WAB is in the better half of the industry, outperforming 70.40% of the companies in the same industry.
In the last couple of years the Profit Margin of WAB has grown nicely.
WAB has a Operating Margin of 16.04%. This is in the better half of the industry: WAB outperforms 76.80% of its industry peers.
WAB's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 32.77%, WAB perfoms like the industry average, outperforming 54.40% of the companies in the same industry.
In the last couple of years the Gross Margin of WAB has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.04% | ||
| PM (TTM) | 10.17% | ||
| GM | 32.77% |
OM growth 3Y9.42%
OM growth 5Y12.6%
PM growth 3Y12.67%
PM growth 5Y20.68%
GM growth 3Y1.91%
GM growth 5Y3.36%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), WAB is destroying value.
The number of shares outstanding for WAB has been reduced compared to 1 year ago.
WAB has less shares outstanding than it did 5 years ago.
WAB has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.69 indicates that WAB is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.69, WAB is in the better half of the industry, outperforming 60.80% of the companies in the same industry.
WAB has a debt to FCF ratio of 2.45. This is a good value and a sign of high solvency as WAB would need 2.45 years to pay back of all of its debts.
WAB has a better Debt to FCF ratio (2.45) than 73.60% 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 in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 2.45 | ||
| Altman-Z | 3.69 |
ROIC/WACC0.81
WACC10.39%
2.3 Liquidity
A Current Ratio of 1.30 indicates that WAB should not have too much problems paying its short term obligations.
WAB has a Current ratio of 1.30. This is amonst the worse of the industry: WAB underperforms 84.00% of its industry peers.
A Quick Ratio of 0.69 indicates that WAB may have some problems paying its short term obligations.
The Quick ratio of WAB (0.69) is worse than 86.40% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.3 | ||
| Quick Ratio | 0.69 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 26.98% over the past year.
The Earnings Per Share has been growing by 12.44% on average over the past years. This is quite good.
WAB shows a small growth in Revenue. In the last year, the Revenue has grown by 7.34%.
WAB shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.84% yearly.
EPS 1Y (TTM)26.98%
EPS 3Y20.82%
EPS 5Y12.44%
EPS Q2Q%9.09%
Revenue 1Y (TTM)7.34%
Revenue growth 3Y9.92%
Revenue growth 5Y4.84%
Sales Q2Q%2.26%
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 13.27% yearly.
WAB is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.94% yearly.
EPS Next Y15.39%
EPS Next 2Y14.16%
EPS Next 3Y13.27%
EPS Next 5YN/A
Revenue Next Year5.33%
Revenue Next 2Y4.89%
Revenue Next 3Y4.94%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 24.52 indicates a rather expensive valuation of WAB.
WAB's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of WAB to the average of the S&P500 Index (29.63), we can say WAB is valued inline with the index average.
WAB is valuated rather expensively with a Price/Forward Earnings ratio of 21.25.
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 (22.68), we can say WAB is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.52 | ||
| Fwd PE | 21.25 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as WAB.
WAB's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. WAB is cheaper than 72.80% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.51 | ||
| EV/EBITDA | 16.73 |
4.3 Compensation for Growth
WAB's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of WAB may justify a higher PE ratio.
WAB's earnings are expected to grow with 13.27% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.59
PEG (5Y)1.97
EPS Next 2Y14.16%
EPS Next 3Y13.27%
5. Dividend
5.1 Amount
WAB has a yearly dividend return of 0.52%, which is pretty low.
WAB's Dividend Yield is comparable with the industry average which is at 1.67.
Compared to an average S&P500 Dividend Yield of 2.29, WAB's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.52% |
5.2 History
On average, the dividend of WAB grows each year by 7.24%, which is quite nice.
WAB has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of WAB decreased recently.
Dividend Growth(5Y)7.24%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
13.26% of the earnings are spent on dividend by WAB. This is a low number and sustainable payout ratio.
WAB's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP13.26%
EPS Next 2Y14.16%
EPS Next 3Y13.27%
184.63
-7.48 (-3.89%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners93.49%
Inst Owner Change3.35%
Ins Owners1.03%
Ins Owner Change-0.55%
Market Cap31.74B
Analysts78.75
Price Target216.48 (17.25%)
Short Float %1.32%
Short Ratio1.9
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.52% |
Yearly Dividend0.8
Dividend Growth(5Y)7.24%
DP13.26%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.46%
Min EPS beat(2)-3.51%
Max EPS beat(2)4.42%
EPS beat(4)3
Avg EPS beat(4)7.46%
Min EPS beat(4)-3.51%
Max EPS beat(4)25.9%
EPS beat(8)6
Avg EPS beat(8)6.61%
EPS beat(12)8
Avg EPS beat(12)4.42%
EPS beat(16)12
Avg EPS beat(16)4.15%
Revenue beat(2)0
Avg Revenue beat(2)-2.18%
Min Revenue beat(2)-2.31%
Max Revenue beat(2)-2.06%
Revenue beat(4)1
Avg Revenue beat(4)-0.54%
Min Revenue beat(4)-2.31%
Max Revenue beat(4)3.14%
Revenue beat(8)5
Avg Revenue beat(8)1.63%
Revenue beat(12)6
Avg Revenue beat(12)0.63%
Revenue beat(16)7
Avg Revenue beat(16)-0.14%
PT rev (1m)1.97%
PT rev (3m)14.92%
EPS NQ rev (1m)-0.88%
EPS NQ rev (3m)-1.3%
EPS NY rev (1m)-0.05%
EPS NY rev (3m)-0.12%
Revenue NQ rev (1m)-0.6%
Revenue NQ rev (3m)-0.08%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)0.11%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.52 | ||
| Fwd PE | 21.25 | ||
| P/S | 3.06 | ||
| P/FCF | 19.51 | ||
| P/OCF | 17.3 | ||
| P/B | 3.14 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.73 |
EPS(TTM)7.53
EY4.08%
EPS(NY)8.69
Fwd EY4.71%
FCF(TTM)9.47
FCFY5.13%
OCF(TTM)10.67
OCFY5.78%
SpS60.43
BVpS58.71
TBVpS-9.03
PEG (NY)1.59
PEG (5Y)1.97
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.65% | ||
| ROE | 10.46% | ||
| ROCE | 11.17% | ||
| ROIC | 8.45% | ||
| ROICexc | 8.87% | ||
| ROICexgc | 49.38% | ||
| OM | 16.04% | ||
| PM (TTM) | 10.17% | ||
| GM | 32.77% | ||
| FCFM | 15.66% |
ROA(3y)4.45%
ROA(5y)3.72%
ROE(3y)8.17%
ROE(5y)6.81%
ROIC(3y)6.98%
ROIC(5y)5.93%
ROICexc(3y)7.29%
ROICexc(5y)6.18%
ROICexgc(3y)42.04%
ROICexgc(5y)35.85%
ROCE(3y)9.23%
ROCE(5y)7.84%
ROICexcg growth 3Y23.75%
ROICexcg growth 5Y18.66%
ROICexc growth 3Y22.7%
ROICexc growth 5Y19.49%
OM growth 3Y9.42%
OM growth 5Y12.6%
PM growth 3Y12.67%
PM growth 5Y20.68%
GM growth 3Y1.91%
GM growth 5Y3.36%
F-Score8
Asset Turnover0.56
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 2.45 | ||
| Debt/EBITDA | 1.6 | ||
| Cap/Depr | 41.15% | ||
| Cap/Sales | 1.99% | ||
| Interest Coverage | 9.2 | ||
| Cash Conversion | 84.56% | ||
| Profit Quality | 154.07% | ||
| Current Ratio | 1.3 | ||
| Quick Ratio | 0.69 | ||
| Altman-Z | 3.69 |
F-Score8
WACC10.39%
ROIC/WACC0.81
Cap/Depr(3y)35.76%
Cap/Depr(5y)32.52%
Cap/Sales(3y)1.9%
Cap/Sales(5y)1.83%
Profit Quality(3y)139.69%
Profit Quality(5y)149.06%
High Growth Momentum
Growth
EPS 1Y (TTM)26.98%
EPS 3Y20.82%
EPS 5Y12.44%
EPS Q2Q%9.09%
EPS Next Y15.39%
EPS Next 2Y14.16%
EPS Next 3Y13.27%
EPS Next 5YN/A
Revenue 1Y (TTM)7.34%
Revenue growth 3Y9.92%
Revenue growth 5Y4.84%
Sales Q2Q%2.26%
Revenue Next Year5.33%
Revenue Next 2Y4.89%
Revenue Next 3Y4.94%
Revenue Next 5YN/A
EBIT growth 1Y21.69%
EBIT growth 3Y20.27%
EBIT growth 5Y18.05%
EBIT Next Year25.19%
EBIT Next 3Y12.54%
EBIT Next 5YN/A
FCF growth 1Y60.3%
FCF growth 3Y19.94%
FCF growth 5Y14.4%
OCF growth 1Y52.71%
OCF growth 3Y19.56%
OCF growth 5Y12.55%