Wabtec (NYSE:WAB) saw its shares drop 9% intra-day today after delivering disappointing fourth-quarter results and issuing a weaker-than-expected 2025 earnings outlook.
For Q4, the rail equipment maker posted adjusted earnings per share of $1.68, falling short of the $1.74 consensus estimate. Revenue of $2.58 billion also missed forecasts of $2.63 billion, despite rising 2.3% year-over-year.
For full-year 2024, Wabtec reported adjusted EPS of $7.56 on revenue of $10.39 billion, reflecting 7.3% annual revenue growth. However, investors focused on the company’s cautious guidance for 2025, with projected adjusted EPS of $8.35 to $8.75. The midpoint of $8.55 came in below Wall Street’s $8.64 estimate, raising concerns about slower earnings momentum.
Despite the earnings miss, Wabtec highlighted strong order growth, with Q4 orders increasing 20% year-over-year, driven by over $1 billion in new locomotive and modernization contracts. The company’s 12-month backlog grew 3% to $7.68 billion, signaling continued demand for its rail solutions.
While Wabtec delivered higher orders and margin expansion in 2024, the softer-than-expected profit outlook for 2025 has left investors wary, triggering the stock’s sharp decline.