Westinghouse Air Brake Technologies Corporation WAB
WAB remains a high-quality rail technology compounder with FY2025 revenue of $11.17B and diluted EPS of $6.83, up 13.1% year-over-year, while operating margin expanded to 16.7% from 11.2% in FY2021 — and Q2 2026 results beat estimates with a raised full-year outlook. However, the stock at $292.23 trades at 39.2x earnings and 22.7x EV/EBITDA, a 48% and 52% premium to peer medians respectively, leaving little margin for error.
Total debt surged to $5.54B in FY2025 from $3.98B in FY2024 while free cash flow declined to $1.50B from $1.63B, and insiders net sold $56.7M over 24 months with the CEO and group presidents actively divesting into the August 2026 rally. Strong execution and a large backlog are real, but the stretched valuation, rising leverage, and persistent insider selling cap the risk/reward.
What could go wrong
- Valuation compression. At 39.2x earnings and 22.7x EV/EBITDA — 48% and 52% above peer medians — any growth disappointment could trigger a sharp de-rating.
- Leverage deterioration. Total debt jumped to $5.54B in FY2025 from $3.98B in FY2024 while FCF fell to $1.50B from $1.63B, signaling acquisition-driven balance sheet strain.
- Insider selling pressure. Over 24 months insiders net sold 198,336 shares worth $56.7M, with the CEO and multiple group presidents selling throughout August 2026 near $293–$300 per share.
- Cyclical demand risk. Freight rail capex is cyclical; tariff tensions and supply-chain disruptions noted in recent industry commentary could slow orders despite the current backlog.
What would change my mind
Where this comes from: FMP annual fundamentals + derived_metrics, FY2025 · derived_metrics, FY2021–FY2025 · peer_relative, as of 2026-08-28 · FMP annual fundamentals, FY2024–FY2025. Orin's read on WAB; not advice.
Twelve months actual closes to 2026-09-23 · actual filings
50-day average 200-day average · volume below
On file
All WAB filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Fmr | $5.8B | 0.3% of fund |
| Vanguard Capital Management | $3.0B | 0.1% of fund |
| State Street | $2.1B | 0.1% of fund |
| Price T Rowe Associates /Md/ | $2.0B | 0.2% of fund |
| Vanguard Portfolio Management | $1.9B | 0.1% of fund |
| Geode Capital Management | $1.2B | 0.1% of fund |
104 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 288 Form 4 filings, net −$57.4M. Of the 50 on hand, 0 were open-market purchases and 45 sales— the rest are grants, option exercises and tax withholding.
Ask Orin about WAB
Orin answers questions about WAB from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 39.2× | 31.0× | 44.5× |
| EV/EBITDA | 22.7× | 15.4× | — |
| P/S | 4.12× | 2.34× | — |
| P/B | 4.4× | 2.2× | — |
Its P/E sits above all 5 of the last 5 years (+6.53σ from its own mean).
14.5%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $1.5B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$327
$291 – $355 · +13% against today's price
- 21 buy or overweight
- 12 hold
- 1 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| WABWestinghouse Air Brake Technologies Corporation | $49B | 39.2× | 22.7× | 34.3% | 10.6% | 11% |
| EMEEMCOR Group, Inc. | $33B | 23.5× | 14.7× | 19.7% | 7.7% | 38% |
| FIXComfort Systems USA, Inc. | $57B | 39.9× | 28.4× | 25.7% | 12.8% | 54% |
| IRIngersoll Rand Inc. | $30B | 31.1× | 17.0× | 37.9% | 12.1% | 9% |
| ODFLOld Dominion Freight Line, Inc. | $37B | 34.2× | 20.2× | 31.7% | 19.4% | 25% |
| OTISOtis Worldwide Corporation | $26B | 17.5× | 14.1× | 30.2% | 10.2% | -27% |
| RKLBRocket Lab USA, Inc. | $41B | — | — | 37.3% | -21.5% | -8% |
| UALUnited Airlines Holdings, Inc. | $36B | 10.3× | 7.1× | 65.1% | 5.6% | 23% |
| VRSKVerisk Analytics, Inc. | $22B | 26.3× | 15.9× | 67.7% | 28.2% | -212% |
| XYLXylem Inc. | $25B | 25.9× | 14.6× | 39.2% | 11.1% | 9% |
The median is of the 8 peers listed above and nothing else — check it against the column. This company trades 50.3% above it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Discounted cash flow
| Model | Fair value | Against | Computed |
|---|---|---|---|
| Standard DCF | $268 | $257.22 · +4% | 2026-06-10 |
| Levered DCF | $274 | $257.22 · +6% | 2026-06-10 |
The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.