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Westinghouse Air Brake Technologies Corporation (WAB) is a leading provider of locomotives, technology-based equipment, systems, and services to the global freight rail and passenger transit industries. Valued at a market cap of $34.7 billion, it operates through two segments: Transit and Freight.
Companies worth $10 billion or more are generally described as “large-cap stocks.” WAB effortlessly fits that bill, with its market cap exceeding this mark, underscoring its size, influence, and dominance within the railroad industry. The company has established a robust market presence and consistently meets demand in the freight and transit sectors, showcasing its competitive strength and effective business strategies.
WAB currently hovers around its 52-week high of $207.51, achieved on Dec. 9. Over the past three months, WAB stock gained 13.8%, slightly trailing the broader Nasdaq Composite's ($NASX) 14.1% gain over the same time frame.
However, in the longer term, shares of WAB climbed 56.2% on a YTD basis and surged 62.3% over the past 52 weeks, outpacing NASX’s YTD gains of 34% and solid 35.7% returns over the last year.
To confirm the bullish trend, WAB has traded above its 200-day moving average for the past year and over its 50-day moving average since early September.
On Oct. 23, WAB released its third-quarter earnings, and its shares dropped 1.3%. Its adjusted EPS of $2 surpassed Street’s estimates, and revenue of $2.7 billion also beat the market’s projections. The company expects full-year earnings in the range of $7.45 to $7.65 per share, with revenue in the range of $10.25 billion to $10.55 billion.
In the competitive arena of railroad stocks, Union Pacific Corporation (UNP) has struggled to keep up with WAB. UNP has dropped 6.4% on a YTD basis and 5% over the past year.
Wall Street analysts are reasonably optimistic about WAB’s prospects. The stock has a consensus “Moderate Buy” rating from the nine analysts covering it, and the mean price target of $218.44 suggests a potential upside of 10.2% from current price levels.
