Westinghouse Air Brake Outlook - A Weak Technical Profile and Mixed Analyst Signals

Market Snapshot

Headline Takeaway: The technical side of Westinghouse Air Brake (WAB) is weak, with an internal diagnostic score of 2.97 (0-10), and we suggest investors avoid it based on the bearish indicators. The stock has recently fallen by 2.70%, aligning with the mixed expectations in the market.

News Highlights

• Farm Machinery Industry Eyes Modest Recovery - Sales in the agricultural machinery sector stabilized in November 2024 and rose 12% through February 2025. This could indirectly benefit WAB, which serves the broader industrial machinery market.
• Trump Fast-Traces Utah Uranium Mine - President Trump has accelerated the approval of uranium mining in Utah. While WAB doesn't directly participate in uranium extraction, renewed interest in mining infrastructure could support the company's long-term operations.
• China’s Factory Activity Contracts, But Shows Signs of Recovery - China’s PMI fell to 49.5 in May, but the slowdown from April suggests a potential near-term turnaround. WAB’s exposure to global manufacturing could benefit from a rebound in production activity.

Analyst Views & Fundamentals

Analyst Ratings

• Average Rating: 4.00 (simple mean) from three analysts, including "Strong Buy," "Buy," and "Neutral" ratings.
• Weighted Rating: 2.47, factoring in historical performance and predictive accuracy.
• Rating Consistency: Dispersed, with conflicting views from major institutions like Susquehanna (75% win rate) and Morgan Stanley (0% win rate).
• Price Trend Alignment: The current price is down 2.70%, and the weighted expectations suggest market caution. This aligns with the bearish technical indicators.

Fundamental Highlights

• EV/EBIT: 38.11 (internal score: 3.00). A higher ratio suggests lower profitability relative to enterprise value.
• PE Ratio: 55.01 (internal score: 3.00). Indicates high valuation relative to earnings.
• Total Operating Revenue YoY Growth: 3.40% (internal score: 2.00). Suggests modest revenue growth but below average performance.
• Basic Earnings Per Share YoY Growth: 20.75% (internal score: 2.00). Positive but not enough to outweigh other bearish fundamentals.
• Profit-MV Score: -0.28 (internal score: 3.00). Indicates mixed profitability signals.

Money-Flow Trends

The recent fund-flow data paints a negative picture for WAB, with overall inflow ratios trending downward across all categories. The block inflow ratio is at 48.63%, and large, extra-large, and small inflow ratios are all below 50%, indicating a cautious approach from major investors. While retail participation is mixed, the dominant negative sentiment from institutional players suggests continued downward pressure.

Key Technical Signals

Westinghouse Air Brake’s technical indicators remain bearish. The stock has 5 negative indicators, 1 bullish, and 0 neutral signals over the last five days. The MACD Golden Cross is the only bullish indicator, with an internal diagnostic score of 8.22. However, this is offset by three negative dividend-related dates (Ex-Dividend, Dividend Record, and Payable) which all scored 1.00.

• Recent Chart Patterns:
  • 2025-08-13: WR Overbought and MACD Golden Cross
  • 2025-08-14: Ex-Dividend and Dividend Record
  • 2025-08-28: Dividend Payable
• Key Insights: Technical indicators show a weak market state, and there is a high risk of further declines. The bearish indicators clearly outnumber the bullish ones, reinforcing the suggestion to avoid the stock.

Conclusion

Given the weak technical setup with an internal diagnostic score of 2.97, the mixed analyst ratings, and the recent bearish money flows, Westinghouse Air Brake (WAB) appears to be a stock to avoid for now. Investors might want to consider waiting for a pull-back or clearer signs of momentum reversal before considering entry. Monitor the upcoming fundamental reports and technical developments for any positive shifts in the stock’s trend.