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Wabtec (WAB) Buys India-Based Rail Friction Business for $34M

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Westinghouse Air Brake Technologies Corporation (WAB - Free Report) announced the takeover of the railway friction business from India-based MASU, which makes friction offerings for the automotive and rail sectors.

The deal, valued at approximately $34 million, has obtained regulatory approval and is subject to customary closing requirements. The president of Wabtec’s Transit business, Lilian Leroux, stated, “MASU is a strategic acquisition for Wabtec that complements our product portfolio and builds upon our leadership position in the railway friction market”.

The buyout is expected to strengthen Wabtec’s installed base and expand its brake product portfolio. Through this takeover, WAB will be able to boost its position as a ‘Made in India’ manufacturer, provide an attractive offering for customers and open new opportunities for regional and international expansion.

Zacks Rank & Stocks to Consider

Wabtec currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Some better-ranked stocks in the broader Zacks Transportation sector are J.B. Hunt Transport Services (JBHT - Free Report) , FedEx Corporation (FDX - Free Report) and Schneider National (SNDR - Free Report) .

The long-term expected earnings per share (three to five years) growth rate for J.B. Hunt is pegged at 15%. JBHT is benefiting from strong performances across all its segments. The Dedicated Contract Services (DCS) unit is aided by fleet-productivity improvement and a rise in average revenue-producing trucks. The Integrated Capacity Solutions (ICS) unit is gaining from a favorable customer freight mix as well as higher contractual and spot rates.

JBHT’s measures to reward its shareholders are encouraging. Driven by the tailwinds, the stock has increased 37% in the past year. J.B. Hunt currently carries a Zacks Rank #2 (Buy).

The long-term expected earnings per share (three to five years) growth rate for FedEx is pegged at 12%. FDX is benefitting from a surge in e-commerce demand amid the pandemic.

FDX exited first-quarter fiscal 2022 with cash and equivalents of $6,853 million, much higher than its current debt of $125 million. Driven by the tailwinds, the stock has moved up 6.6% in the past year. FedEx currently carries a Zacks Rank #2.

The long-term expected earnings per share (three to five years) growth rate for Schneider is pegged at 17.9%. SNDR benefits from strong performance in the Intermodal and Logistics units.

SNDR’s third-quarter cash balance is also encouraging. Driven by the tailwinds, the stock has moved up 22.2% in the past year. Schneider currently carries a Zacks Rank #2.
 

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