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Westinghouse Air Brake Technologies Corporation WAB, commonly known as Wabtec, reported first-quarter 2025 earnings per share (excluding 40 cents from non-recurring items) of $2.28, which beat the Zacks Consensus Estimate of $2.01. The bottom line improved 20.6% year over year due to higher sales and operating margin expansion.
Revenues of $2.61 billion edged past the Zacks Consensus Estimate of $2.6 billion. The top line grew 4.5% year over year due to higher sales in the Freight and Transit segments.
Apart from the better-than-expected results, WAB increased the mid-point of its 2025 earnings per share view by 10 cents. This pleased investors, resulting in WAB’s shares gaining value in pre-market trading.
WAB widened the projected range for its 2025 EPS expectations due to the tariff-induced uncertainty. The company now expects 2025 adjusted earnings per share to be in a band of $8.35-$8.95 compared with the previously guided range of $8.35-$8.75. The mid-point of the newly guided range (i.e. $8.65) is above the mid-point of the previous band (i.e, $8.55). The Zacks Consensus Estimate is currently pegged at a much lower $8.27 per share.
Wabtec price-consensus-eps-surprise-chart | Wabtec Quote
The Freight unit's net sales of $1.9 billion increased 4.2% year over year. This increase was due to the 16.9% uptick in services. The actual segmental sales figure was above our expectations of $1.87 billion. Freight segment’s adjusted operating margin improved 1.6 points year over year to 25.7%.
In the Transit segment, net sales grew 5.3% year over year to $709 million, due to strong aftermarket and original equipment sales. The actual segmental sales figure surpassed our estimation of $703.4 million. The segmental adjusted operating margin increased to 14.6% from 12.7% in the first quarter of 2024, aided by higher sales and better gross margins.
Total operating expenses in the reported quarter increased $23 million from a year ago to $426 million. Operating ratio (operating expenses as a % of net sales) deteriorated to 16.3 from 16.2 a year ago. A lower value of the metric is desirable.
Wabtec exited the first quarter with cash, cash equivalents and restricted cash of $698 million compared with $715 million at 2024-end.
Long-term debt was $3.5 billion compared with $3.48 billion at 2024-end. During the reported quarter, WAB returned $141 million to its shareholders via dividends ($43 million) and stock buybacks ($98 million).
Wabtec, belonging to the Zacks Transportation - Equipment and Leasing industry, still expects revenues in the range of $10.725-$11.025 billion. The Zacks Consensus Estimate is currently pegged at $10.84 billion, below the mid-point of the guided range.
For 2025, management expects operating cash flow conversion to exceed 90%.
We note that another major player from the same industry, Air Lease AL, will report its first-quarter earnings numbers early next month. (See the Zacks Earnings Calendar to stay ahead of market-making news.)
Air Lease is scheduled to report first-quarter 2025 earnings on May 5. The company’s performance in the first quarter is expected to have suffered from demand weakness, geopolitical uncertainty, tariff-related uncertainties and high inflationary pressure.
AL’s earnings have outpaced the Zacks Consensus Estimate in two of the last four quarters (missing the mark on the other two occasions). The average miss is 3.3%.
Currently, WAB carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
United Airlines’ UAL first-quarter 2025 earnings per share (excluding 25 cents from non-recurring items) of 91 cents surpassed the Zacks Consensus Estimate of 75 cents. In the year-ago quarter, the Chicago-based airline reported a loss of 15 cents per share.
Operating revenues of $13.21 billion fell marginally short of the Zacks Consensus Estimate of $13.22 billion. The top line increased 5.4% year over year despite the tariff-induced slowdown in domestic air travel demand. Passenger revenues (which accounted for 89.7% of the top line) rose 4.8% to $11.9 billion. UAL flights transported 40,806 passengers in the first quarter, up 3.8% year over year.
Delta Air Lines DAL reported first-quarter 2025 earnings (excluding 9 cents from non-recurring items) of 46 cents per share, which surpassed the Zacks Consensus Estimate of 40 cents. Earnings increased 2.2% on a year-over-year basis due to low fuel costs.
Revenues in the March-end quarter were $14.04 billion, surpassing the Zacks Consensus Estimate of $13.81 billion and increasing 2.1% on a year-over-year basis. Adjusted operating revenues (excluding third-party refinery sales) rose 3.3% year over year to $13 billion.
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This article originally published on Zacks Investment Research (zacks.com).
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