Sunday, April 19, 2015

Seeking Alpha: Wabtec Looking To Leverage Mandates And Grab Foreign Share

Value investors have nightmares about stocks like Westinghouse Air Brake Technologies (NYSE:WAB) (or Wabtec). The shares are expensive by most conventional metrics, but the company has roughly doubled its margins over the past decade and only scratched the surface of its market share opportunities outside of North America. Skilled at both product development and M&A, Wabtec has tied itself to the ongoing growth and use of both freight and transit rail - arguably as close as you can get to a sure thing in the industrial world.

Valuation remains a challenge when it comes to this stock. On one hand, projecting double-digit annualized revenue growth for a company that is already generating more than $3 billion a year in revenue and has more than 50% share in its core market is aggressive. On the other hand, while replicating such impressive share outside of North America is by no means guaranteed, getting only half that would still be more than enough to support 10%-plus revenue growth.

Read more here:
Wabtec Looking To Leverage Mandates And Grab Foreign Share

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