WABTEC CORP (WAB) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:WAB - US9297401088 - Common Stock
233.7 USD
+0.7 (+0.3%)
233.7 USD
0 (0%)
Taking everything into account, WAB scores 5 out of 10 in our fundamental rating. WAB was compared to 132 industry peers in the Machinery industry. While WAB belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. WAB is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
- WAB had positive earnings in the past year.
- In the past year WAB had a positive cash flow from operations.
- In the past 5 years WAB has always been profitable.
- WAB had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- WAB has a Return On Assets of 5.48%. This is in the better half of the industry: WAB outperforms 62.88% of its industry peers.
- WAB's Return On Equity of 10.68% is fine compared to the rest of the industry. WAB outperforms 63.64% of its industry peers.
- The Return On Invested Capital of WAB (8.04%) is comparable to the rest of the industry.
- Measured over the past 3 years, the Average Return On Invested Capital for WAB is below the industry average of 10.24%.
- The 3 year average ROIC (6.98%) for WAB is below the current ROIC(8.04%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.48% | ||
| ROE | 10.68% | ||
| ROIC | 8.04% |
ROA(3y)4.45%
ROA(5y)3.72%
ROE(3y)8.17%
ROE(5y)6.81%
ROIC(3y)6.98%
ROIC(5y)5.93%
1.3 Margins
- WAB has a better Profit Margin (10.94%) than 76.52% of its industry peers.
- In the last couple of years the Profit Margin of WAB has grown nicely.
- Looking at the Operating Margin, with a value of 17.22%, WAB belongs to the top of the industry, outperforming 80.30% of the companies in the same industry.
- WAB's Operating Margin has improved in the last couple of years.
- WAB has a better Gross Margin (33.96%) than 60.61% of its industry peers.
- In the last couple of years the Gross Margin of WAB has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.22% | ||
| PM (TTM) | 10.94% | ||
| GM | 33.96% |
OM growth 3Y9.42%
OM growth 5Y12.6%
PM growth 3Y12.67%
PM growth 5Y20.68%
GM growth 3Y1.91%
GM growth 5Y3.36%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), WAB is destroying value.
- The number of shares outstanding for WAB has been reduced compared to 1 year ago.
- Compared to 5 years ago, WAB has less shares outstanding
- WAB has a better debt/assets ratio than last year.
2.2 Solvency
- WAB has an Altman-Z score of 3.41. This indicates that WAB is financially healthy and has little risk of bankruptcy at the moment.
- WAB has a Altman-Z score of 3.41. This is comparable to the rest of the industry: WAB outperforms 57.58% of its industry peers.
- The Debt to FCF ratio of WAB is 4.17, which is a neutral value as it means it would take WAB, 4.17 years of fcf income to pay off all of its debts.
- WAB has a Debt to FCF ratio of 4.17. This is comparable to the rest of the industry: WAB outperforms 58.33% of its industry peers.
- WAB has a Debt/Equity ratio of 0.46. This is a healthy value indicating a solid balance between debt and equity.
- WAB has a Debt to Equity ratio (0.46) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 4.17 | ||
| Altman-Z | 3.41 |
ROIC/WACC0.84
WACC9.58%
2.3 Liquidity
- A Current Ratio of 1.42 indicates that WAB should not have too much problems paying its short term obligations.
- WAB has a Current ratio of 1.42. This is in the lower half of the industry: WAB underperforms 75.00% of its industry peers.
- WAB has a Quick Ratio of 1.42. This is a bad value and indicates that WAB is not financially healthy enough and could expect problems in meeting its short term obligations.
- Looking at the Quick ratio, with a value of 0.75, WAB is doing worse than 81.06% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.42 | ||
| Quick Ratio | 0.75 |
3. Growth
3.1 Past
- WAB shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 15.70%, which is quite good.
- WAB shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 12.44% yearly.
- The Revenue has been growing slightly by 4.40% in the past year.
- The Revenue has been growing slightly by 4.84% on average over the past years.
EPS 1Y (TTM)15.7%
EPS 3Y20.82%
EPS 5Y12.44%
EPS Q2Q%16%
Revenue 1Y (TTM)4.4%
Revenue growth 3Y9.92%
Revenue growth 5Y4.84%
Sales Q2Q%8.37%
3.2 Future
- WAB is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.64% yearly.
- Based on estimates for the next years, WAB will show a small growth in Revenue. The Revenue will grow by 5.53% on average per year.
EPS Next Y20.22%
EPS Next 2Y16.74%
EPS Next 3Y15.23%
EPS Next 5Y12.64%
Revenue Next Year6.18%
Revenue Next 2Y7.19%
Revenue Next 3Y6.57%
Revenue Next 5Y5.53%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
- The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 27.33, the valuation of WAB can be described as expensive.
- WAB's Price/Earnings is on the same level as the industry average.
- WAB's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.32.
- WAB is valuated rather expensively with a Price/Forward Earnings ratio of 22.77.
- The rest of the industry has a similar Price/Forward Earnings ratio as WAB.
- When comparing the Price/Forward Earnings ratio of WAB to the average of the S&P500 Index (24.32), we can say WAB is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.33 | ||
| Fwd PE | 22.77 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as WAB.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of WAB is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.51 | ||
| EV/EBITDA | 19.03 |
4.3 Compensation for Growth
- WAB's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- The decent profitability rating of WAB may justify a higher PE ratio.
- A more expensive valuation may be justified as WAB's earnings are expected to grow with 15.23% in the coming years.
PEG (NY)1.35
PEG (5Y)2.2
EPS Next 2Y16.74%
EPS Next 3Y15.23%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.44%, WAB is not a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 0.98, WAB has a dividend in line with its industry peers.
- With a Dividend Yield of 0.44, WAB pays less dividend than the S&P500 average, which is at 1.83.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.44% |
5.2 History
- On average, the dividend of WAB grows each year by 7.24%, which is quite nice.
- WAB has been paying a dividend for at least 10 years, so it has a reliable track record.
- The dividend of WAB decreased recently.
Dividend Growth(5Y)7.24%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
- WAB pays out 13.90% of its income as dividend. This is a sustainable payout ratio.
- WAB's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP13.9%
EPS Next 2Y16.74%
EPS Next 3Y15.23%
WABTEC CORP / WAB FAQ
Can you provide the ChartMill fundamental rating for WABTEC CORP?
ChartMill assigns a fundamental rating of 5 / 10 to WAB.
What is the valuation status of WABTEC CORP (WAB) stock?
ChartMill assigns a valuation rating of 3 / 10 to WABTEC CORP (WAB). This can be considered as Overvalued.
Can you provide the profitability details for WABTEC CORP?
WABTEC CORP (WAB) has a profitability rating of 7 / 10.
Can you provide the financial health for WAB stock?
The financial health rating of WABTEC CORP (WAB) is 4 / 10.
Can you provide the dividend sustainability for WAB stock?
The dividend rating of WABTEC CORP (WAB) is 5 / 10 and the dividend payout ratio is 13.9%.