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WABCO’s Income and Revenue Fell in 3Q15

US Equity Market Updates for October 22

(Continued from Prior Part)

WABCO’s price movement

WABCO Holdings (WBC) has a market cap of $6.4 billion. WABCO’s YTD (year-to-date) price movement has been mixed of ups and downs in 2015. After the 3Q15 earnings report, WBC rose by 1.6% to close at $110.04 per share as of October 22, 2015. The price movement on a weekly, monthly, and a YTD basis is 0.19%, 5.4%, and 5.0%, respectively.

The stock has broken support levels throughout 2015. Currently, it’s trading at 1.7% above the 20-day moving average, 1.8% below the 50-day moving average, and 5.9% below its 200-day moving average.

The iShares Asia/Pacific Dividend 30 Fund (DVYA) invests 3.0% of its holdings in WABCO. The ETF tracks a dividend-weighted index of 30 of the highest-dividend-yielding companies in the Asia-Pacific region. The YTD price movement of DVYA is -14.7% as of October 21, 2015. The ALPS International Sector Dividend Dogs (IDOG) invests 2.1% of its holdings in WABCO.

The competitors of WABCO Holdings (WBC) and their market caps are:

  • General Motors Company (GM) — $56.1 billion

  • Cummins (CMI) — $20.0 billion

  • PACCAR (PCAR) — $19.1 billion

  • Meritor (MTOR) — $1.0 billion

Performance of WABCO in 3Q15

The company has reported net revenue of $643.6 million in 3Q15, a decrease of 2.6% when compared to the net revenue of $661.1 million in 2Q15. The cost of sales as a percentage of sales has fallen by 8.8% in 3Q15. The net income and EPS (earnings per share) have fallen to $41.3 million and $0.67 per share in 3Q15, a decrease of 39.5% and 40.2% on a quarterly basis. The cash and cash equivalents have increased to $544.1 million in 3Q15. The current ratio has fallen to 3.00, and the debt-to-equity ratio has fallen to 2.15 in 3Q15 as compared to the current ratio and the debt-to-equity ratio of 3.06 and 1.98 in 2Q15.

Some of WABCO’s key 3Q15 highlights were:

  • WABCO Holdings has entered into a long-term supply agreement with JMCH to expand into the heavy truck segment.

  • WABCO Holdings has joined the Commercial Vehicle Safety Alliance to improve the safety of its brakes.

  • The company has expanded its software engineering and shared services capabilities with the opening of new facilities in Chennai.

  • The company has entered into a new long-term agreement as a major supplier of a range of advanced and conventional technologies with Russia’s heavy-duty commercial vehicle manufacturers.

  • The company has stopped manufacturing operations at two production facilities in Western Europe to preserve competitiveness for mechanical products.

About WABCO

WABCO Holdings is a supplier of technologies and control systems to improve the safety and efficiency of commercial vehicles. It provides products for braking, stability, suspension, transmission automation, and aerodynamics.

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