Is Westinghouse Air Brake Technologies Corp (WAB) overvalued?
On Equity Rank's model estimate, WAB trades 38% above its fair value. Westinghouse Air Brake Technologies Corp (WAB) last closed at $283.59; the multi-method model fair value is $205.91.
| Price | Model fair value | Price vs model |
|---|---|---|
| $283.59 | $205.91 | 38% above |
What the answer rests on
- 0 of 10 valuation methods put WAB's value above its price and 10 put it below, so the methods mostly agree.
- To justify today's price, WAB's free cash flow would need to grow about 12.5% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 19.0% a year.
- WAB trades at 36.6 times its last year's earnings, against a median of 27.1 for 7 profitable Transportation companies.
- Over the past year the price sat below the model fair value on 0% of trading days. The gap ranged from 27% above to 93% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind WAB's fair value · What prices assume · Other companies