U.S. Markets close in 2 hrs 48 mins
  • S&P 500

    3,825.33
    +39.95 (+1.06%)
     
  • Dow 30

    31,097.26
    +321.86 (+1.05%)
     
  • Nasdaq

    11,127.84
    +99.14 (+0.90%)
     
  • Russell 2000

    1,727.76
    +19.77 (+1.16%)
     
  • Crude Oil

    110.30
    +1.87 (+1.72%)
     
  • Gold

    1,807.40
    +5.90 (+0.33%)
     
  • Silver

    19.86
    +0.19 (+0.98%)
     
  • EUR/USD

    1.0428
    +0.0001 (+0.0104%)
     
  • 10-Yr Bond

    2.8890
    0.0000 (0.00%)
     
  • Vix

    26.70
    -2.01 (-7.00%)
     
  • GBP/USD

    1.2109
    +0.0006 (+0.0484%)
     
  • USD/JPY

    135.6670
    +0.4920 (+0.3640%)
     
  • BTC-USD

    19,578.24
    -194.35 (-0.98%)
     
  • CMC Crypto 200

    420.84
    +0.70 (+0.17%)
     
  • FTSE 100

    7,232.65
    +64.00 (+0.89%)
     
  • Nikkei 225

    26,153.81
    +218.19 (+0.84%)
     

Solid Cash Balance Boosts Wabtec (WAB) Amid High Capex

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·3 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

We have recently updated a report on Westinghouse Air Brake Technologies Corporation WAB.

The long-term expected earnings per share (three to five years) growth rate for Wabtec is pegged at 12.6%. Wabtec has an earnings surprise of 1.5%, on average, beating estimates in three of the last four quarters. The stock has gained 26% in the past year compared with a 37.8% rally of the industry.

Zacks Investment Research
Zacks Investment Research

Image Source: Zacks Investment Research

WAB exited third-quarter 2021 with cash and equivalents of $456 million, significantly above the current debt of $4 million. This indicates that the company has enough cash to meet its current debt obligations. Additionally, its current ratio (a measure of liquidity) at the end of the September quarter stood at 1.34, higher than the reading of 1.20 at 2020-end.

Wabtec’s cost-cutting measures are impressive. While releasing third-quarter 2021 results, management stated that the company achieved the $250-million run-rate savings a year earlier than predicted on the back of its cost-cutting measures.

WAB anticipates CAPEX, which was $78.5 million in the first nine months of 2021, to be around $120 million in 2021 despite the woes. High capital expenses might hurt the company’s already weak bottom line, which declined 10% year over year in 2020.

Zacks Rank & Stocks to Consider

Wabtec currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Some better-ranked stocks in the broader Zacks Transportation sector are J.B. Hunt Transport Services, Inc. JBHT, Landstar System, Inc. LSTR and C.H. Robinson Worldwide, Inc. CHRW.

The long-term expected earnings per share (three to five years) growth rate for J.B. Hunt is pegged at 15%. JBHT is benefiting from strong performances across all its segments. While the Dedicated Contract Services (DCS) unit is being driven by fleet productivity improvement and a rise in average revenue-producing trucks, the Integrated Capacity Solutions (ICS) unit is gaining from favorable customer freight mix as well as higher contractual and spot rates.

JBHT’s measures to reward shareholders are encouraging. Driven by the tailwinds, the stock has increased 50.4% in the past year. J.B. Hunt currently carries a Zacks Rank #2 (Buy).

The long-term expected earnings per share (three to five years) growth rate for Landstar is pegged at 12%. LSTR is benefitting from a gradual recovery in the economy and freight market conditions in the United States.

LSTR’s top and the bottom line increased substantially in each quarter from third-quarter 2020, owing to robust revenues in the primary segment — truck transportation. LSTR has surged 32.4% in the past year. Landstar carries a Zacks Rank #2 presently.

The long-term expected earnings per share (three to five years) growth rate for C.H. Robinson is pegged at 9%. CHRW benefits from higher pricing and volumes across most of its service lines. Total revenues jumped 42.4% year over year in the first nine months of 2021, with higher revenues across all the segments.

CHRW’s measures to reward its shareholders are encouraging. Driven by the tailwinds, the stock has moved up 14.1% in the past year. C.H. Robinson currently carries a Zacks Rank #2.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

J.B. Hunt Transport Services, Inc. (JBHT) : Free Stock Analysis Report

C.H. Robinson Worldwide, Inc. (CHRW) : Free Stock Analysis Report

Westinghouse Air Brake Technologies Corporation (WAB) : Free Stock Analysis Report

Landstar System, Inc. (LSTR) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research