Westinghouse Air Brake Technologies Corporation (WAB) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: Westinghouse Air Brake Technologies Corporation

Updated on October 22, 2026 · accounts published on October 21, 2026

Reading of October 21, 2026: A growing industrial with widening margins and strong cash conversion

Westinghouse Air Brake Technologies trades at a P/E of 38.8 over the last 12 months, 50 % above its sector median of 25.8.

• Is Westinghouse Air Brake Technologies expensive or cheap? Its P/E of 38.8 is 50 % above the sector median and higher than in 82 % of the last decade.
• How is the business doing? Operating margin reached 17.3 % over the last 12 months, against a 13.3 % average for fiscal 2014-2025.
• How strong is the balance sheet? Net debt is 2.1× EBITDA in fiscal 2025, under the sector's 3× limit, and the dividend has risen six years running.
• What to expect from the next earnings? Analysts expect EPS of $2.65 for the quarter reported on February 10, 2027; 21 of 34 rate the stock a buy.
• Does it turn its margin into cash, and what cycle multiple does it trade at? Free cash flow was 128 % of net income in fiscal 2025, but EV/EBITDA of 21.2 is well above its seven-year average of 16.1.

Is Westinghouse Air Brake Technologies expensive or cheap?

At 38.8 times earnings over the last 12 months, Westinghouse Air Brake Technologies trades 20 % above its ten-year median P/E of 32.4. It is also well above the 25.8 median of its 404-company sector. Over the decade the multiple has ranged from 17.9 to 45.8, so today it sits in the upper part of that band: the stock has been cheaper 82 % of the time. EV/EBITDA of 21.2 points the same way against its seven-year average of 16.1. With an earnings yield of 2.7 % and a free cash flow yield of 3.8 %, the market is already paying for more growth after a 46 % rise in the share over 12 months.

How is the business doing?

Over the last 12 months revenue grew 7.5 % and EPS grew 13.1 %. Earnings are rising faster than sales, which fits with margins expanding. The operating margin of 17.3 % compares with 16.7 % in fiscal 2025 and a 13.3 % average across 2014-2025, a clear step up. The weak point is return on capital. ROIC of 8.2 % sits 0.8 points below the sector median of 9.0 % and has not topped 10 % in any of the last ten fiscal years. The company now earns more on each sale than it used to, yet it still earns modest returns on the capital it employs.

How strong is the balance sheet?

Debt is manageable for an industrial. Net debt of $29.19 per share in fiscal 2025 equals about 10 % of the current share price, and debt to equity is 0.41 over the last 12 months. An Altman Z of 3.1 sits just inside the safe zone above 2.99, with little room to spare. The current ratio of 1.10 leaves a thin short-term cushion. Shareholder returns are small but steady: a 0.4 % dividend yield, six straight years of higher dividends through fiscal 2025 and a payout of only 15 % of earnings. That low payout leaves plenty of room to keep raising the dividend.

What to expect from the next earnings?

The October 21, 2026 report showed EPS of $2.83 against $2.73 expected, a 3.7 % beat. The company has topped estimates in 6 of the last 8 quarters. The next quarter is expected to come in lower, at $2.65. Over the last 30 days the 2026 EPS consensus has barely moved, from $10.86 to $10.87 among seven analysts, and revenue estimates are just as stable, so expectations are steady. Of 34 analysts, 21 recommend buying, 12 holding and 1 selling. With a P/E of 38.8 over the last 12 months, the February 10, 2027 report has a high bar to clear.

Does it turn its margin into cash, and what cycle multiple does it trade at?

Industrials are semi-cyclical, so one year's earnings can swing with the cycle. That is why the sector is judged on the order book, operating margin and how much profit becomes cash. Westinghouse Air Brake Technologies converts well. Free cash flow equalled 128 % of net income in fiscal 2025, above the healthy threshold of 85 %, and the 16.7 % operating margin clears the 12 % bar. Capex of only 2.3 % of revenue sits below the 4-8 % range the sector considers healthy, which helps cash flow today. On the cycle, EV/EBITDA of 21.2 is more than 110 % of its seven-year average of 16.1, the sector's line for expensive.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.