What happened

Shares of Westinghouse Air Brake Technologies (NYSE:WAB), or Wabtec, fell more than 11% on Monday as concerns about the health of the industrial economy continued to mount. The COVID-19 coronavirus outbreak appears increasingly likely to slow global shipping, which in turn will have an impact on Wabtec's railroad customers.

So what

Wabtec is in a period of transition, last year swallowing the locomotive business of General Electric (NYSE:GE) to increase its size and scale but also taking on a challenging integration. Trends in the railroad business, including a push by major operators to move more freight with fewer locomotives, were also weighing on investors heading into 2020.

Rail cars going past a station.

Image source: Getty Images.

The coronavirus is the latest complication to Wabtec's long-term growth plans. As the outbreak spreads, it seems more likely to derail industrial production and could slow global shipping. That in turn seems likely to eat into railroad growth projections, potentially meaning fewer railroad locomotive sales and less maintenance work for Wabtec service yards.

Wabtec had hoped to offset potential weakness in U.S. railroad demand for locomotives by increasing international sales. But the widespread reach of the coronavirus has left few regions untouched and could make it harder for the company to generate growth in 2020.

Now what

Wabtec remains a strong operator, but it is still affected by the current mess, so it is no surprise the company's shares are falling along with those of railroads and other businesses tied to the global shipping industry.

For those with the patience to ride through the rough stretch, Wabtec's long-term value proposition is just as strong now as it was two months ago. The company might now need longer than anticipated to get the merger integration behind it and move onto the fast track, but this remains an intriguing stock for long-term holders.