Viacom
Viacom
February 15, 2018
Wabtec Corporation
  • Investment:  Long
  • Company Website:  Click to visit
  • Status:  Current

Wabtec Corporation

Industrials   |   United States

Wabtec
$95.5

WSD Target Price

+13%

Annualized Return Since Publication

+$1.7B

Target Equity Value (Δ)

Source: Bloomberg end of day market data; not adjusted for dividends (May 14, 2018).

Returns assume a long investment position on the date that WSD Capital Management published its thesis, and an exit on the date that the WSD Target Price is realized.

Returns do not reflect any fees, expenses or taxes.

The returns are hypothetical and do not reflect the actual results of WSD Capital Management’s investment activities, nor is it necessarily indicative of future results of WSD Capital Management’s investment activities.

Summary

Wabtec Corporation (“Wabtec”) is a global provider of value-added, technology-based products and services for freight rail, passenger transit and other industrial segments.

WSD Capital Management announced its investment in Wabtec on September 27, 2016. We were attracted to the company due to the stable growth, scale relative to its peers, well-established and trusted brand, and high cash flow generation.

In 2016, the company acquired Faiveley Transport, its largest competitor in the world’s largest transit market (the acquisition was completed in March 2017). Wabtec management’s acquisition strategy has boosted the company’s exposure to the faster-growing mass-transit markets, which are expected to maintain their growth trajectories as emerging economies invest more in public transit and developed economies make a renewed push for energy efficiency.

While some of the unfavorable market conditions will continue to persist in 2017, we believe there is a meaningful opportunity at the company to improve operating margins by managing costs and enhancing competitiveness through a diligent integration of Faiveley.

On April 20, 2018, it was reported that General Electric is in discussions to sell its rail business to Wabtec.

 

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