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On Friday, KeyBanc Capital Markets maintained its Overweight rating and $220.00 price target for Wabtec Corporation (NYSE:WAB), a leading technology provider for the freight and transit rail industries. With a market capitalization of $32.9 billion and current trading price of $192.11, InvestingPro analysis indicates the stock is trading above its Fair Value. The affirmation comes after KeyBanc analysts attended Wabtec’s Investor Field Trip, where the company’s management team offered deeper insights into its strategic plans and advanced technology initiatives.
During the event, Wabtec’s management outlined its updated five-year targets, which include achieving mid-single-digit (MSD) organic sales growth and a double-digit (DD) earnings per share (EPS) compound annual growth rate (CAGR) through 2029. The company has demonstrated solid performance with revenue growth of 7.3% and an EBITDA of $2.12 billion in the last twelve months. Despite Wabtec’s shares trading at a premium compared to historical multiples, with a current P/E ratio of 31.7, KeyBanc views the recent negative price movement post-fourth quarter earnings as an opportunity for investors to buy in at an attractive level.
The firm believes that Wabtec’s near-term (NT) and medium-term (MT) guidance are conservative, especially considering the company’s focused approach to mergers and acquisitions (M&A). KeyBanc’s medium-term analysis suggests that Wabtec’s earnings potential could approach low-teens EPS.
Additionally, Wabtec showcased its advanced technology product lines to attendees, which included prototypes for autonomous short-haul locomotives, remote train operations, automated yard inspection tools, and fully reversible mixed fuel source engine modifications. These innovations underscore the company’s commitment to leading the rail industry’s technological advancement. Get comprehensive insights into Wabtec’s financial health, growth prospects, and detailed valuation metrics with InvestingPro’s exclusive Research Report, part of our coverage of 1,400+ top US stocks.
KeyBanc analysts are maintaining their estimates and reiterated their Overweight rating and $220 price target for Wabtec stock, signaling confidence in the company’s growth trajectory and investment potential. The company maintains an overall "GOOD" Financial Health score according to InvestingPro metrics, with particularly strong scores in growth and profitability.
In other recent news, Westinghouse Air Brake Technologies Corp (Wabtec) reported its fourth-quarter 2024 earnings, revealing an adjusted earnings per share (EPS) of $1.68, which fell short of the forecasted $1.74. The company’s revenues also missed expectations, coming in at $2.58 billion compared to the anticipated $2.63 billion. Despite these misses, Wabtec demonstrated strong full-year performance with a 7.3% revenue increase and a 27.7% rise in adjusted EPS. Meanwhile, KeyBanc analysts have maintained their Overweight rating for Wabtec, with a price target of $220, suggesting that the recent dip in share price presents a buying opportunity for long-term investors. The firm’s analysis projects that Wabtec’s earnings per share could reach low to mid-teens in dollars, emphasizing the company’s strategic focus on international expansion and digital innovation. Additionally, Wabtec has announced new five-year goals extending to 2029, having already met its previous targets ahead of schedule. The company also provided 2025 sales guidance of $10.7 to $11.0 billion, aiming for a 5% growth at the midpoint, along with an adjusted EPS range of $8.35 to $8.75, representing a 13% growth at the midpoint.
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