A month has gone by since the last earnings report for Westinghouse Air Brake Technologies (WAB Quick QuoteWAB - Free Report) . Shares have lost about 0.4% in that time frame, outperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Wabtec due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Wabtec Q3 Earnings Beat Estimates

Westinghouse Air Brake Technologies Corporation reported encouraging third-quarter 2025 results wherein both earnings and revenues surpassed the Zacks Consensus Estimate as well as reported year-over-year growth.

Quarterly earnings per share of $2.32 beat the Zacks Consensus Estimate of $2.23 and improved 16% year over year due to higher sales, operating margin expansion and benefits from share repurchases. Revenues of $2.88 billion outpaced the Zacks Consensus Estimate of $2.86 billion. The top line grew 8.4% year over year due to higher sales in the Freight segment (which includes the acquisition of Inspection Technologies) and in the Transit segment.

WAB’s Segmental Highlights

Freight segment’s net sales of $2.09 billion grew 8.4% year over year. The upside was aided by growth in Equipment sales (up 32% driven by higher locomotive deliveries), Digital sales (up 45.6% owing to the acquisition of Inspection Technologies) and Components sales

Freight segment’s adjusted operating margin grew to 24.5% from 24.1% in the year-ago quarter. Adjusted operating margin benefited from improved gross margin, which was partially offset by higher operating expenses as a percentage of revenue.

In the Transit segment, net sales grew 8.2% year over year to $793 million, due to strong aftermarket and original equipment sales. The segmental adjusted operating margin increased to 15.5% from 12.8% in the third quarter of 2024, aided by improved gross margins, partially offset by higher operating expenses as a percent of revenue.

Other Q3 Details of WAB 

Total operating expenses in the reported quarter increased $64 million from a year ago to $511 million. Operating ratio (operating expenses as a % of net sales) rose to 17.7% from 16.8% a year ago.

Wabtec exited the third quarter with cash, cash equivalents and restricted cash of $528 million compared with $1.49 billion at the prior quarter-end. Long-term debt was $5.03 billion compared with $4.78 billion at the prior quarter-end.

During the reported quarter, WAB paid $43 million in dividends.

WAB’s 2025 Guidance

Wabtec raised and tightened its 2025 adjusted EPS guidance range to $8.85 to $9.05 from the prior guided range of $8.55 to $9.15. The Zacks Consensus Estimate of $8.90 lies within the guidance.

For revenues, WAB continues to expect its 2025 guidance between $10.925 billion and $11.225 billion. The Zacks Consensus Estimate of $11.08 billion lies within the guidance.

For 2025, Wabtec continues to expect operating cash flow conversion to exceed 90%.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended upward during the past month.

VGM Scores

Currently, Wabtec has a average Growth Score of C, however its Momentum Score is doing a bit better with a B. However, the stock has a grade of D on the value side, putting it in the bottom 40% for value investors.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Wabtec has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.