Westinghouse Air Brake Technologies Corp (WAB), a leading rail equipment manufacturer, saw its stock plummet 9.43% in pre-market trading on Wednesday. The sharp decline followed the company's release of its 2025 financial guidance and fourth-quarter earnings results, which fell short of analysts' expectations.
Wabtec forecasted its 2025 adjusted earnings per share to range from $8.35 to $8.75, lower than the analysts' average estimate of $8.62. The company also projected its 2025 sales to fall between $10.73 billion and $11.03 billion, narrowly missing the FactSet consensus estimate of $11.03 billion.
The disappointing guidance was attributed to weak freight demand and sluggish freight activity. Higher prices and borrowing costs have dampened consumer demand for goods, causing a slowdown in freight volume transported by rail. This, in turn, has impacted the demand for new locomotives and freight cars, which are part of Wabtec's core business segments.