Is WAB's Q1 2025 EPS forecast a buying opportunity?

**Westinghouse Air Brake's (WAB) Q1 2025 EPS forecast does not present a clear buying opportunity** based on the current information available. Here's why: 1. **Recent Performance and Outlook**: WAB's stock has experienced a decline, with the last price being $173.58, which is a 6.63% decrease from the previous day. This decline has brought the stock closer to its 52-week low of $131.33, indicating a substantial market reaction. The company's 2025 sales guidance is $10.7 to $11.0 billion, aiming for a 5% growth at the midpoint, which may not be compelling enough to justify a purchase at the current EPS forecast. 2. **Earnings Miss and Revenue Shortfall**: WAB's fourth-quarter earnings missed analyst estimates by $0.06, with an EPS of $1.68 compared to the estimated $1.74. Additionally, revenue fell short of estimates, coming in at $2.58 billion compared to the consensus estimate of $2.63 billion. These misses could indicate underlying issues with the company's financial performance, which may dampen investor confidence. 3. **Cash Flow and Backlog Strength**: On a positive note, WAB reported strong cash flow from operations of $722 million for the fourth quarter, with a cash conversion of 212%. The company also has a substantial 12-month backlog of $7.7 billion, indicating strong momentum. However, these positive aspects may not be enough to counterbalance the negative sentiment surrounding the earnings miss. 4. **Market Sentiment**: The market's reaction to the earnings miss and the company's guidance may be cautious, as evidenced by the stock's decline. Investors may require a more significant improvement in the company's financial performance or a clearer outlook before viewing WAB as a buying opportunity. In conclusion, while WAB's Q1 2025 EPS forecast of $2.01 may seem attractive, the recent earnings miss, revenue shortfall, and market reaction suggest that investors should exercise caution. A buying opportunity may present itself if the company demonstrates improved financial performance or if there is a positive market sentiment shift. Until then, the current forecast does not strongly indicate a buying opportunity.