RIO DE JANEIRO - MRS Logística, a significant railway operator in Brazil, has entered into a contract with Wabtec Corporation for the procurement of 30 new Evolution Series locomotives. The deal, valued at approximately R$500 million, is a strategic move for MRS to renew its railway fleet, with initial deliveries expected in 2024. This investment underscores the nearly three-decade partnership between MRS and Wabtec.
The president of MRS Logística, Guilherme Segalla de Mello, emphasized the importance of the fleet renewal for enhancing efficiency and safety in the company's operations. He highlighted the commitment to energy efficiency and reduced gas emissions in line with sustainable development goals and regulatory commitments to the Federal Government.
The new ES44ACi locomotives are designed to align with the global shift towards sustainable practices, offering reductions in emissions compared to older models. Their advanced technology is expected to lower operating costs over the locomotive's lifespan due to increased intervals between diesel engine overhauls.
Danilo Miyasato, president and regional leader of Wabtec Latin America, noted the locomotives' high performance, reliability, and lower CO2 emissions, reflecting a vision for a more environmentally friendly railway network in Brazil.
The ES44ACi model, launched in 2022, is equipped with a 4,500 horsepower Evolution Series diesel engine. Its innovative design focuses on thermal efficiency and features a double intake air cooling system to boost energy efficiency and curb emissions.
MRS manages a 1,643 km railway network in regions that contribute to half of Brazil's GDP, connecting production areas to major ports. The network facilitates a diverse transportation operation, including commodities and industrial goods, with a significant portion of Brazil's exports and rail cargo traveling via MRS tracks.
Wabtec Corporation, listed on the New York Stock Exchange as NYSE: WAB, has a longstanding history in the rail industry and is actively working towards a zero-emission rail system in the U.S. and globally.
This announcement is based on a press release statement from MRS Logística and Wabtec Corporation.
InvestingPro Insights
Wabtec Corporation (NYSE: WAB), a key player in the global rail industry, has recently secured a significant contract with MRS Logística, reinforcing its commitment to sustainable transportation solutions. As Wabtec continues to advance its zero-emission rail system goals, the company's financial health and market performance remain critical for investors and stakeholders alike.
According to InvestingPro data, Wabtec boasts a robust market capitalization of $23.95B, indicating its significant presence in the industry. The company's P/E ratio stands at 29.63, with a slight adjustment in the last twelve months as of Q4 2023 to 27.96, reflecting its earnings power. Additionally, Wabtec's PEG ratio for the same period is 0.94, suggesting a balance between its price and expected earnings growth, which could be appealing to value investors.
InvestingPro Tips highlight that Wabtec is trading at a low P/E ratio relative to near-term earnings growth, and the stock generally trades with low price volatility. These aspects are particularly relevant considering the company's recent contract with MRS Logística, as they may influence investor confidence in Wabtec's ability to deliver on new projects while maintaining financial stability. Moreover, Wabtec has maintained dividend payments for 30 consecutive years, demonstrating a commitment to returning value to shareholders.
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With a total of 9 InvestingPro Tips available for Wabtec Corporation, investors have a wealth of information at their fingertips to make informed decisions about their investments in the evolving rail sector.
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