Key Stats for WAB Stock
- 6-Month Performance: 36%
- 52-Week Range: $152 to $266
- Valuation Model Target Price: $309
- Implied Upside: 17%
Value your favorite stocks like Westinghouse Air Brake Technologies with 5 years of analysts’ forecasts using TIKR’s new Valuation Model (It’s free) >>>
What Happened?
Westinghouse Air Brake Technologies Corporation stock has climbed about 36% over the past six months, recently trading near $263 per share and approaching its 52-week high of $266. The rally reflects sustained investor confidence following strong earnings execution, expanding backlog visibility, increased capital returns, and continued institutional accumulation.
Shares moved higher after the company reported fourth quarter 2025 results that reinforced its growth trajectory into 2026. Sales rose 15% to $3.0 billion, adjusted EPS increased 25% to $2.10, and operating cash flow reached $992 million.
Backlog strength stood out, with the 12-month backlog climbing 7% to $8.2 billion and multi-year backlog surpassing $27 billion, up 23%, providing strong revenue visibility.
CEO Rafael Santana said, “This is the strongest position our company has been in,” as the board approved a 24% dividend increase and expanded the share repurchase authorization to $1.2 billion.
Management guided 2026 sales of $12.2 billion to $12.5 billion and adjusted EPS of $10.05 to $10.45, implying 10.5% and 14% growth at the midpoint.
Institutional positioning has also supported the advance. Rhumbline Advisers increased its stake 3.6% to 330,938 shares valued at $66.34 million, Candriam S.C.A. raised its holdings 3.9% to 482,986 shares worth $96.82 million, and National Pension Service lifted its position 4.5% to 285,391 shares valued at $57.21 million.
Machina Capital S.A.S. boosted its stake 180.1% to 30,736 shares, BNP Paribas Asset Management increased its holdings 374.2% to 135,996 shares, and NEOS Investment Management expanded its position 111.5% to 19,281 shares.
Institutional investors now own about 91.69% of the company, underscoring broad professional ownership.
Insider activity added context near recent highs. CEO Rafael Santana sold 1,798 shares on Feb. 10 at an average price of $245.71 for roughly $441,787, trimming his stake by 1.49%, while EVP Gregory Sbrocco sold 952 shares on Feb. 19 at $258.43 for about $246,025.
These transactions were modest relative to total ownership, but insider selling near record levels often coincides with periods of consolidation following strong rallies.
Is WAB Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 7.2%
- Operating Margins: 21.8%
- Exit P/E Multiple: 22.5x
Revenue is projected to expand from $11.17 billion in 2025 to $12.30 billion in 2026 and $13.04 billion in 2027, supported by backlog conversion, modernization programs, and sustained international demand rather than short-cycle freight volatility.
Management expects 2026 sales of $12.2 billion to $12.5 billion, reflecting 10.5% growth at the midpoint and marking another year of expansion.
Margin expansion toward the low 20% range is driven by Integration 3.0 cost initiatives, which are now expected to deliver $115 million to $140 million of run-rate savings by the end of 2028, along with mix improvements in digital intelligence, inspection technologies, and higher-value locomotive modernization programs.
Fleet renewal remains a structural growth driver. More than 25% of active North American locomotives are over 20 years old, and the new EVO Modernization program is designed to deliver more than 20% improvement in reliability and up to 7% fuel efficiency gains.
These operational improvements create measurable economic returns for rail operators and support multi-year modernization demand.
International markets add another layer of growth, with strong pipeline momentum across Latin America, Africa, India, and Asia. Combined with acquisitions such as Frauscher Sensor Technologies and Dellner Couplers, Wabtec continues expanding its technology portfolio and recurring revenue exposure.
Based on these inputs, the valuation model implies a target price of $309, suggesting about 17% upside from current levels near $263, indicating the stock appears modestly undervalued.
While the stock has already delivered strong gains over the past six months, continued backlog execution, modernization demand, cost discipline, and double-digit EPS growth in 2026 remain the primary drivers of future performance.
Estimate a company’s fair value instantly (Free with TIKR) >>>
Value Any Stock in Under 60 Seconds (It’s Free)
With TIKR’s new Valuation Model tool, you can estimate a stock’s potential share price in under a minute.
All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
From there, TIKR calculates the potential share price and total returns under Bull, Base, and Bear scenarios so you can quickly see whether a stock looks undervalued or overvalued.
If you’re not sure what to enter, TIKR automatically fills in each input using analysts’ consensus estimates, giving you a quick, reliable starting point.
See a stock’s true value in under 60 seconds (Free with TIKR) >>>
