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    WAB · NYQ · Industrials

    Westinghouse Air Brake Technologies Corporation

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 92.58

    Market price

    USD 286.79

    Implied upside

    -67.7%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    AdjustedReported capital expenditure averages 2.01% of revenue against depreciation of 5.14%. A business cannot depreciate more than it invests indefinitely. Capex has been set to 5.14% of revenue so the forecast is not handed free growth. Override it if the reported figure is right.

    Current EV/EBITDA of 23.7x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.

    Value Per Share

    Perpetuity growth
    USD 92.58-67.7%
    Exit multiple
    USD 215.29-24.9%
    Market price
    USD 286.79

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn1bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 12.5bnUSD 13.4bnUSD 14.2bnUSD 15.0bnUSD 15.8bnUSD 16.6bnUSD 17.2bnUSD 17.9bnUSD 18.4bnUSD 18.9bn+4.7%
    EBITUSD 1.8bnUSD 1.9bnUSD 2.0bnUSD 2.1bnUSD 2.2bnUSD 2.3bnUSD 2.4bnUSD 2.5bnUSD 2.6bnUSD 2.7bn+4.7%
    NOPATUSD 1.4bnUSD 1.5bnUSD 1.6bnUSD 1.7bnUSD 1.8bnUSD 1.9bnUSD 1.9bnUSD 2.0bnUSD 2.1bnUSD 2.1bn+4.7%
    Add depreciation & amortisationUSD 579.1mUSD 619.1mUSD 658.3mUSD 696.5mUSD 733.0mUSD 767.5mUSD 799.3mUSD 828.0mUSD 853.3mUSD 874.6m+4.7%
    Less capital expenditureUSD -641.9mUSD -727.9mUSD -818.5mUSD -912.9mUSD -1.0bnUSD -1.1bnUSD -1.2bnUSD -1.3bnUSD -1.4bnUSD -1.5bn+9.9%
    Capex, % of revenue5.1%5.4%5.8%6.1%6.4%6.7%7.0%7.3%7.6%7.9%-
    Less increase in working capitalUSD -289.8mUSD -187.5mUSD -184.4mUSD -179.2mUSD -171.6mUSD -161.7mUSD -149.5mUSD -135.1mUSD -118.6mUSD -100.2m-11.1%
    Free cashflow to firmUSD 1.0bnUSD 1.2bnUSD 1.2bnUSD 1.3bnUSD 1.3bnUSD 1.4bnUSD 1.4bnUSD 1.4bnUSD 1.4bnUSD 1.4bn+3.2%
    Discount factor0.96030.88550.81650.75290.69420.64010.59030.54430.50190.4628-
    Present valueUSD 1.0bnUSD 1.1bnUSD 1.0bnUSD 969.8mUSD 918.7mUSD 865.2mUSD 810.3mUSD 754.4mUSD 698.3mUSD 642.6m-
    Present Value Of The ForecastUSD 8.7bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.952Reported 0.929, pulled toward 1.0 (Blume)
    Cost of equity8.92%Risk-free + beta x equity risk premium
    Cost of debt5.44%Risk-free + 55bp, the spread for a AA rating at 8.0x interest cover. Book interest / average debt was lower, at 4.7%.
    Market capitalisationUSD 48.4bn89.7% of capital
    Total debtUSD 5.5bn10.3% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC8.45%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 92.58

    58% of EV

    Forecast FCFF, final year
    USD 1.4bn
    Capex at depreciation, working capital in reinvestment
    USD 2.1bn
    Less reinvestment at g/ROIC (29.6% of NOPAT)
    USD -625.7m
    Capitalised
    USD 1.5bn
    ROIC (WACC floor)
    8.4%
    Terminal value, undiscounted
    USD 25.7bn
    Terminal value, discounted
    USD 11.9bn
    Enterprise value
    USD 20.6bn
    Less net debt
    USD 4.8bn
    Equity value
    USD 15.8bn

    Exit at 20.0x EBITDA

    Value per shareUSD 215.29

    79% of EV

    Terminal value, undiscounted
    USD 71.0bn
    Terminal value, discounted
    USD 32.9bn
    Enterprise value
    USD 41.6bn
    Less net debt
    USD 4.8bn
    Equity value
    USD 36.8bn

    Spread between methods: 80%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.45%144.17144.86146.22148.55152.32
    7.45%114.66113.12111.65110.26108.99
    8.45%95.7694.1792.5890.9989.40
    9.45%81.6380.2878.9477.5976.25
    10.45%70.2769.1267.9766.8265.67

    Outlined: this model. Green text: above today's price of 286.79. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year10.1%5.4%18.5%
    EBIT margin16.1%14.2%35.5%
    Discount rate-8.4%4.7%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.