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Investing.com - DA Davidson raised its price target on Wabash National (NYSE:WNC) to $9.50 from $7.50 on Monday, while maintaining a Neutral rating on the trailer manufacturer's stock. The company, currently trading at $10.21, has seen its shares decline over 50% in the past year, according to InvestingPro data.
The research firm cited a slightly higher market multiple over the last few months as the main reason for the price target adjustment, increasing its next-twelve-months EV/EBITDA multiple to approximately 7.5x from 6.5x previously.
DA Davidson positioned its targeted multiple at the low end of the peer group, noting significant risks ahead as freight markets search for stability, and described current visibility as "unusually low."
The firm acknowledged positive aspects of Wabash National's business, including ongoing growth in Parts & Service, Trailer-as-a-Service, and new offerings that will make trailer ordering easier.
Despite these positive elements, DA Davidson indicated that its current model assumptions for an upturn in 2026 carry too much risk to warrant a more constructive stance at current levels.
In other recent news, Wabash National Corporation reported disappointing first-quarter 2025 earnings, revealing a notable miss on both earnings per share (EPS) and revenue forecasts. The company posted an EPS of -$0.58, falling short of the expected -$0.26, and revenue of $381 million, below the projected $414.55 million. Additionally, S&P Global Ratings downgraded Wabash's credit rating to 'B+' from 'BB-' due to weaker cash flows and higher leverage, while Moody's Ratings also lowered the company's ratings, citing a significant decrease in expected earnings for 2025. Despite these challenges, Wabash announced a regular quarterly dividend of $0.08 per share, payable on July 24 to shareholders of record as of July 3. Analyst firm DA Davidson maintained a Neutral rating on Wabash, with a price target of $7.50, referencing a decline in the US trailer industry as a contributing factor. The company is appealing a legal verdict, with punitive damages reduced to $108 million from an initial $450 million, adding uncertainty to its financial outlook. Wabash is focusing on expanding its Trailers as a Service (TaaS) initiative and parts services to mitigate cyclicality and enhance long-term growth. Despite the current downturn, Wabash remains optimistic about achieving positive EPS in the latter half of 2025.
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