Bank of America Securities has revised upward its price target for Wabtec Corporation (NYSE:WAB), raising it to $263 from the previous $253, reaffirming a Buy recommendation on the stock. This revised valuation suggests a 14% potential gain over the current trading price, recently hovering around $230.43. The stock has been performing near its annual peak of $235.05, reflecting strong investor interest in the transportation equipment manufacturer that holds a market capitalization of approximately $39.39 billion.
The revaluation follows Norfolk Southern’s procurement of 40 ES44AC Tier 4 locomotives from Wabtec, marking Norfolk Southern’s first locomotive order since 2022. The delivery of these units is slated for the latter half of 2026. Based on data from InvestingPro, Wabtec has exhibited steady revenue growth, achieving a 4.4% increase over the past twelve months to reach total revenue of $10.79 billion.
Norfolk Southern’s acquisition will expand its current locomotive fleet by about 2.5%, considering the railroad operates roughly 1,600 high-horsepower locomotives. The newly ordered units incorporate advanced control systems, providing capabilities such as real-time remote diagnostics and live operational monitoring. Additionally, these locomotives promise enhancements in fuel efficiency, reduced operational expenditures, decreased emissions, and elevated reliability, offering multiple benefits to the railroad’s operational infrastructure.
The order, formally placed in the third quarter of 2025, is already factored into Wabtec’s backlog figures, according to Bank of America’s research note.
Further strengthening its market position, Wabtec has secured a substantial $386 million contract with New York’s Metropolitan Transportation Authority to supply additional R255 hybrid battery-diesel work locomotives. This contract supports the MTA’s broader Capital Plan aimed at modernizing the urban transit network’s asset base. In parallel, Wabtec completed the acquisition of Frauscher Sensor Technology Group GmbH, a firm specializing in train detection and control solutions, for €675 million in cash. Frauscher is projected to generate revenues in the vicinity of €145 million in 2025.
Reflecting the positive market sentiment, Wolfe Research upgraded Wabtec’s stock rating from Peerperform to Outperform, motivated by expectations of accelerated organic growth starting in 2026. In addition, Bank of America Securities has maintained its Buy rating with a price target set at $233, noting ongoing opportunities tied to the modernization of the North American locomotive fleet. These actions underline Wabtec’s strategic initiatives and the analyst community’s confidence in its future growth potential.