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Angel Castillo

Research Analyst at Morgan Stanley

Angel Castillo is Head Executive Director of Machinery & Construction Equity Research (US) at Morgan Stanley, specializing in machinery, construction, mid-cap chemicals, and packaging sectors. Throughout his career, he has covered a range of companies within these industries, driving in-depth research and investment recommendations, notably during his tenure leading related equity research teams. Castillo joined Morgan Stanley in 2023 after previous roles at Bessemer Trust and Goldman Sachs Group, bringing over a decade of sector-focused analytical experience. He is recognized for his leadership in equity research and has held several senior titles across major financial firms.

Angel Castillo's questions to WESTINGHOUSE AIR BRAKE TECHNOLOGIES (WAB) leadership

Angel Castillo's questions to WESTINGHOUSE AIR BRAKE TECHNOLOGIES (WAB) leadership • Q3 2025

Question

Angel Castillo inquired about Wabtec's organic growth trajectory, addressing investor concerns regarding low single-digit growth versus the mid-single-digit algorithm. He sought insights into the strong pipeline of opportunities, anticipated order pace in North America freight, and whether the backlog implies a reacceleration towards high single-digit organic growth in 2026, including the shape of growth across businesses. He also asked for a breakdown of core services versus modernization (mods) in H2 2025 and expectations for mods growth in 2026.

Answer

President and CEO Rafael Santana highlighted strong pipeline dynamics, noting that the 12-month backlog growth outpaced last year, providing stronger coverage for 2026. He emphasized bullishness in international markets like Kazakhstan, CIS, East Asia, Brazil, and Africa, driven by new rail lines, fleet renewal, and volume growth. Santana also pointed to strong demand in mining for ultra-class systems and profitable growth in transit. He confirmed expectations for combined new locomotive and mods volumes to keep growing into 2026, supported by backlog, with international outpacing North America. Regarding services, Santana explained that the variation in Q3 results was tied to mods, which will continue to fluctuate based on CapEx allocation. He projected core services growth in the 5-7% range, driven by fleet age, innovation, and market share gains.

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Angel Castillo's questions to WESTINGHOUSE AIR BRAKE TECHNOLOGIES (WAB) leadership • Q3 2025

Question

Angel Castillo asked about Wabtec's organic growth trajectory, particularly why management isn't concerned despite low single-digit growth this year versus a mid-single-digit algorithm. He sought color on the strong pipeline of opportunities, anticipated order pace in North America freight, and preliminary thoughts on 2026 organic growth expectations given the backlog implies reacceleration.

Answer

President and CEO Rafael Santana highlighted the strong pipeline dynamics, noting the 12-month backlog growth outpaced last year, providing stronger coverage for 2026. He emphasized bullishness in international markets like Kazakhstan, CIS, East Asia, Brazil, Africa, and mining, along with profitable growth in transit. Santana expects combined volumes for new locomotives and modernizations to grow into 2026, supported by backlog. Regarding services, Santana clarified that the variation in Q3 results was tied to modernizations, while core services are expected to grow in the 5-7% range, driven by fleet age, innovation, and share of wallet gains. He noted international expansion and hard-running North American fleets as key drivers.

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Angel Castillo's questions to PACCAR (PCAR) leadership

Angel Castillo's questions to PACCAR (PCAR) leadership • Q3 2025

Question

Angel Castillo sought quantification of the anticipated tariff headwind for Q4, asking if the projected gross profit margin decline from 12.5% to 12% was solely due to tariffs. He also asked if PACCAR's North American outlook for next year assumes any pre-buy related to the EPA’s 35 mg NOx standard.

Answer

CEO R. Preston Feight confirmed that the Q4 margin impact is mostly due to the tariff ramp-up, with October being the peak, and anticipated marked improvement by December/January. Regarding the 2026 North American market outlook (230,000-270,000 trucks), Feight explained the wide range accounts for uncertainty in the truckload sector's recovery and the assumption that the 35 mg NOx standard will remain. He noted that if the standard changes, it would reduce pre-buy activity, pushing the market towards the lower end of the range.

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Angel Castillo's questions to PACCAR (PCAR) leadership • Q3 2025

Question

Angel Castillo asked for a quantification of the tariff headwind anticipated for Q4 and if the gross profit margin moving from 12.5% to 12% is entirely due to tariff ramp-up. He also inquired if PACCAR's North American outlook for next year assumes any pre-buy related to EPA 27.

Answer

Preston Feight, CEO, attributed the Q4 margin change mostly to tariff ramp-up, with October being the peak. He expects improvement by December/January as Section 232 tariffs reduce costs. Regarding the 2026 North American market outlook (230k-270k range), Mr. Feight explained that the wide range accounts for uncertainty in truckload recovery and the 35 mg NOx standard. If the standard changes, it would reduce pre-buy, pushing the market towards the lower end; if it stays, it pushes towards the higher end.

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Angel Castillo's questions to PACCAR (PCAR) leadership • Q2 2025

Question

Angel Castillo of Morgan Stanley questioned the confidence in second-half deliveries despite recent weak orders and sought more color on the drivers for the guided 4-6% Q3 growth in the parts business, including margin assumptions.

Answer

CEO & Director R. Preston Feight cited several factors for second-half confidence: balancing truckload capacity, benefits from new legislation, and clarity on 2027 emissions standards and tariffs. EVP Kevin Baney attributed the strong parts forecast to the team's performance and normalizing sales growth. CFO & SVP Brice Poplawski noted more shipping days in Europe in Q3 would also help.

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Angel Castillo's questions to PACCAR (PCAR) leadership • Q2 2025

Question

Angel Castillo questioned the confidence in second-half deliveries given recent weak orders and asked for color on the drivers behind the guided 4-6% Q3 revenue growth reacceleration in the Parts business, including the assumed gross margin.

Answer

CEO & Director R. Preston Feight cited several factors for confidence in H2, including the eventual balancing of truckload capacity, benefits from new legislation, and clarity on 2027 emissions standards and tariffs. EVP Kevin Baney attributed the strong Parts forecast to the team's execution and normalizing sales growth. CFO & SVP Brice Poplawski noted that more shipping days in Europe in Q3 will also contribute.

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Angel Castillo's questions to DONALDSON Co (DCI) leadership

Angel Castillo's questions to DONALDSON Co (DCI) leadership • Q4 2025

Question

Angel Castillo from Morgan Stanley requested more detail on the first-half versus second-half cadence for sub-segments like off-road, on-road, and Aerospace & Defense. He also asked for an update on capital allocation, including the M&A pipeline, appetite for buybacks beyond the guidance, and the reason for a decline in the CapEx forecast.

Answer

CFO Brad Pogalz advised using the total company's typical 48/52 first-half/second-half sales split as the best guide for cadence, noting the on-road recovery is modest in dollar terms and A&D comps are lumpy. On capital allocation, he explained the 2-3% share repurchase target is a 'normal' level, balancing returns with M&A flexibility, and the lower CapEx reflects sharper project prioritization. Chairman, CEO & President Tod Carpenter reiterated that the M&A pipeline remains active and is a key strategic priority.

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Angel Castillo's questions to DONALDSON Co (DCI) leadership • Q3 2025

Question

Angel Castillo of Morgan Stanley inquired about the dynamics of Donaldson's gross profit margin, the ability to remain price-cost neutral, and the specific impact of footprint optimization initiatives. He also asked about the reasons for the lowered CapEx outlook and the potential influence of tax policies on future capital investments.

Answer

CFO Brad Pogalz explained that the gross margin decline was primarily due to the 'heavy lifting' phase of plant rationalization projects in the US and UK, but affirmed the company's ability to remain price-cost neutral. CEO Tod Carpenter added that CapEx was deferred to prioritize managing supply chain disruptions and tariff uncertainty, which required holding higher inventory to ensure customer service.

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Angel Castillo's questions to DEERE & (DE) leadership

Angel Castillo's questions to DEERE & (DE) leadership • Q3 2025

Question

Angel Castillo inquired about the progress of the Early Order Programs (EOPs), specifically for planters and combines, and sought more detail on the recent increase in quoting activity.

Answer

Josh Beal, Director of Investor Relations, noted that it was still early for planters and combines, with customers showing caution due to market uncertainty. Cory Reed, President of the Ag & Turf Division, added that while customers are waiting, the initial response to the combine program has been positive. CFO Joshua Jepsen mentioned that strong crop yields could drive incremental demand post-harvest.

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Angel Castillo's questions to MARTIN MARIETTA MATERIALS (MLM) leadership

Angel Castillo's questions to MARTIN MARIETTA MATERIALS (MLM) leadership • Q2 2025

Question

Angel Castillo asked about the potential pricing uplift on the acquired Quikrete assets and sought clarity on the disconnect between numerous data center announcements and slowing construction spend data.

Answer

CEO C. Howard Nye indicated a pricing opportunity exists in the new markets as part of their 'value journey.' Regarding data centers, he attributed the lag on new projects to permitting and utility readiness, describing it as a 'nice, long, steady climb over multiple years' rather than an immediate surge, which suits Martin Marietta's business model.

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Angel Castillo's questions to KENNAMETAL (KMT) leadership

Angel Castillo's questions to KENNAMETAL (KMT) leadership • Q4 2025

Question

Angel Castillo of Morgan Stanley inquired about the fiscal year 2026 outlook, seeking color on Q1 trends and their influence on the full-year segment forecast. He also questioned if the strategic shift towards cost reduction and portfolio optimization is a reaction to near-term demand weakness or deeper, structural challenges at Kennametal.

Answer

President and CEO Sanjay Chowbey stated that the FY26 outlook is a balanced view informed by market indicators and that the year has started in line with projections. He explained the strategic shift is a response to both a prolonged market slowdown and the need to make sustainable, structural cost improvements, while ensuring the company is prepared for an eventual volume recovery.

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Angel Castillo's questions to KENNAMETAL (KMT) leadership • Q4 2025

Question

Angel Castillo of Morgan Stanley asked for more detail on the fiscal year 2026 outlook, specifically how Q1-to-date trends are informing the full-year segment forecasts. He also inquired about the strategic shift toward cost-cutting and portfolio optimization, questioning whether it stems from near-term market conservatism or deeper, company-specific structural challenges.

Answer

Sanjay Chowbey, President, CEO & Director, stated that the FY2026 outlook is a balanced view based on market indicators and customer discussions, with the start of the year tracking in line with full-year projections. He explained the strategic focus on rightsizing is a response to both the prolonged market slowdown and the need to make sustainable structural improvements, while ensuring the company is prepared for an eventual volume recovery.

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Angel Castillo's questions to CUMMINS (CMI) leadership

Angel Castillo's questions to CUMMINS (CMI) leadership • Q2 2025

Question

Angel Castillo of Morgan Stanley inquired about the growth trajectory of Cummins' data center business, referencing a prior forecast of reaching $2 billion in sales by 2026.

Answer

Chair and CEO Jennifer Rumsey confirmed that Cummins remains well-positioned in the growing data center market, benefiting from its Sentum series products and distribution network. Both Rumsey and CFO Mark Smith affirmed that the company's enthusiasm for demand has not changed and that the $2 billion sales target for 2026 remains a reasonable expectation.

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Angel Castillo's questions to CUMMINS (CMI) leadership • Q2 2025

Question

Angel Castillo of Morgan Stanley asked for an update on the data center business, referencing a prior forecast of reaching $2 billion in sales by 2026. He sought to understand the current growth trajectory and market share position.

Answer

Chair and CEO Jennifer Rumsey confirmed that Cummins remains well-positioned in the growing data center market, benefiting from its Sentum series products and distribution network. She noted that additional capacity will be online by 2026 to meet demand. Both she and CFO Mark Smith reaffirmed that the company's enthusiasm for demand has not changed and the $2 billion sales target for 2026 remains intact.

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Angel Castillo's questions to Allison Transmission Holdings (ALSN) leadership

Angel Castillo's questions to Allison Transmission Holdings (ALSN) leadership • Q2 2025

Question

Angel Castillo of Morgan Stanley asked for an outlook on 2026 demand, considering the current weakness as a potential demand push-out, and inquired about the impact of Section 232 tariffs and EPA 2027 regulations on customer pre-buy activity.

Answer

Chair & CEO David Graziosi suggested that OEMs are reducing build rates to avoid entering 2026 oversupplied amid market uncertainty, framing the current slowdown as a demand deferral. He noted Allison is well-positioned against tariffs due to its USMCA sourcing and that its current product portfolio is already prepared to meet future EPA regulations without significant changes.

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Angel Castillo's questions to CNH Industrial (CNH) leadership

Angel Castillo's questions to CNH Industrial (CNH) leadership • Q2 2025

Question

Angel Castillo of Morgan Stanley inquired about CNH's production levels and the progress on reducing dealer inventory, asking for specifics on the remaining excess inventory and the company's confidence in achieving its year-end targets.

Answer

CEO Gerrit Marx confirmed that of the initial €1 billion in excess inventory, another €200 million was reduced in the quarter, keeping them on track for year-end goals. He explained that elevated stock of smaller tractors in North America is a strategic buffer against tariff uncertainty, while South America is on target. He also noted that strong retail demand in parts of Europe, like Poland and Germany, required backfilling orders from company inventory.

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Angel Castillo's questions to OSHKOSH (OSK) leadership

Angel Castillo's questions to OSHKOSH (OSK) leadership • Q2 2025

Question

Angel Castillo of Morgan Stanley asked for more details on the higher sales discounts in the Access segment and the overall competitive landscape. He also inquired if the recent tax bill has impacted customer equipment demand and requested quantification of the tax benefit on the company's free cash flow guidance.

Answer

CFO Matthew Field noted that discounts of 2-3% were in line with expectations. CEO John Pfeifer described a bifurcated demand environment, with strength in large infrastructure and data center projects but some pausing in private non-residential construction. Field confirmed the increased free cash flow guidance largely reflects tax bill changes related to R&D credits, while Pfeifer noted the bill is supportive long-term rather than a driver of a near-term demand spike.

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Angel Castillo's questions to WillScot Holdings (WSC) leadership

Angel Castillo's questions to WillScot Holdings (WSC) leadership • Q2 2025

Question

Angel Castillo of Morgan Stanley inquired about the drivers behind recent improvements in the modular segment, including rental rates and the 7% VAPS growth, and questioned why this strength didn't translate to a more optimistic second-half outlook.

Answer

President & COO Timothy Boswell explained the modular strength is driven by a mix shift towards high-performing Flex and complex units, particularly with enterprise accounts where modular units on rent are up 4% YoY. He noted the order book remains positive. EVP & CFO Matthew Jacobsen added that the H2 outlook reflects continued weakness in smaller, interest-rate-sensitive projects, and while potential tailwinds exist, their near-term impact is not assumed to be immediate. CEO Bradley Soultz also noted the seasonality of the business, suggesting any significant demand improvement would likely not materialize until the following spring.

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Angel Castillo's questions to Vulcan Materials (VMC) leadership

Angel Castillo's questions to Vulcan Materials (VMC) leadership • Q2 2025

Question

Angel Castillo from Morgan Stanley asked what is driving the improved conversion of bids to bookings and whether project deferrals and delays are still occurring at elevated levels or if that trend is also improving.

Answer

Chair & CEO J. Thomas Hill responded that project deferrals have largely passed and jobs are now starting. Senior VP & CFO Mary Carlisle added that the market seems to have moved past a period of uncertainty, evidenced by trailing three-month contract awards in private non-residential turning positive. The improvement is broad-based, excluding single-family housing.

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Angel Castillo's questions to TEREX (TEX) leadership

Angel Castillo's questions to TEREX (TEX) leadership • Q2 2025

Question

Angel Castillo asked about the demand risk from cautious independent rental customers, potential incentives to shift MP production to North America, and whether delayed rent-to-own conversions reflect a structural market shift.

Answer

President & CEO Simon A. Meester stated that the delay in rent-to-own conversions is driven by interest rates and sentiment, not a structural change in ownership preference. He also mentioned that while the company constantly assesses its manufacturing footprint, it is waiting for current market dynamics to stabilize before making significant changes.

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Angel Castillo's questions to TEREX (TEX) leadership • Q3 2024

Question

Angel Castillo of Morgan Stanley sought clarification on the updated revenue guidance, questioning the implied reduction for legacy businesses, and asked about the interest rate conditions needed to restart deferred local projects.

Answer

CFO Julie Beck clarified that the updated outlook is within the margin of the guidance provided in the September pre-announcement. CEO Simon Meester added that the adjustment was a prudent measure, not a major deviation. Regarding deferred projects, Meester explained the issue is more about timing than a specific rate, with sentiment pointing to a pickup in the second half of 2025, while mega projects continue to provide a tailwind.

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Angel Castillo's questions to TIMKEN (TKR) leadership

Angel Castillo's questions to TIMKEN (TKR) leadership • Q2 2025

Question

Angel Castillo sought to clarify if current order trends could support results above the high end of guidance should an atypical recovery occur. He also asked about potential M&A needs for the robotics portfolio and the company's appetite for deals during the CEO transition.

Answer

EVP and CFO Philip Fracassa responded that exceeding the high end of guidance would require a demand acceleration that is not currently assumed. President & CEO Richard Kyle stated that M&A activity continues, likely focusing on bolt-on acquisitions, and that the company's current portfolio is strong enough to win in robotics without further additions, though it could be supplemented.

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Angel Castillo's questions to TIMKEN (TKR) leadership • Q2 2025

Question

Angel Castillo from Morgan Stanley sought to clarify if an atypical second-half recovery could push results above the high end of guidance. He also asked about the company's M&A appetite, particularly for automation, and whether M&A is on hold during the CEO transition.

Answer

EVP and CFO Philip Fracassa responded that exceeding the high end of guidance would require an acceleration in demand, which is not currently assumed. President & CEO Rich Kyle stated that M&A is not on pause during the CEO search, though any near-term deals would likely be bolt-on acquisitions aligned with the current strategy. He added that Timken does not need new acquisitions to win in automation but could supplement its portfolio.

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Angel Castillo's questions to TIMKEN (TKR) leadership • Q2 2025

Question

Angel Castillo from Morgan Stanley sought to clarify if an atypical market recovery could push results above the high end of guidance. He also asked about the company's M&A appetite to bolster its robotics portfolio and whether the ongoing CEO search would pause acquisition activity.

Answer

EVP and CFO Philip Fracassa responded that exceeding the guidance's high end would require a demand acceleration not currently forecasted. President & CEO Rich Kyle affirmed that M&A activity continues, with a focus on bolt-on deals, and is not paused by the CEO transition. He added that while supplemental technologies are considered, the current portfolio is already well-positioned to win in automation.

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Angel Castillo's questions to TIMKEN (TKR) leadership • Q2 2025

Question

Angel Castillo from Morgan Stanley sought to clarify if current order trends could support results above the guidance midpoint and what it would take to exceed the high end. He also asked about M&A appetite for the robotics portfolio and if M&A activity is paused during the CEO transition.

Answer

EVP and CFO Philip Fracassa responded that exceeding the high end of guidance would require an acceleration in demand, which is not currently assumed for the second half. President and CEO Richard Kyle confirmed that M&A is not on pause, though any near-term deals would likely be bolt-on acquisitions. He added that while the company has strong robotics capabilities, it could supplement its portfolio through M&A.

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Angel Castillo's questions to TIMKEN (TKR) leadership • Q2 2025

Question

Angel Castillo of Morgan Stanley sought to clarify if current order trends could push results above the high end of guidance in an atypical recovery scenario. He also asked about the company's M&A appetite for the automation portfolio and whether M&A is on hold during the CEO transition.

Answer

EVP and CFO Philip Fracassa responded that exceeding the high end of guidance would require an acceleration in demand, which is not currently assumed. President & CEO Richard Kyle confirmed that M&A activity continues, stating that any potential deal during the CEO search would likely be a bolt-on acquisition closely aligned with the current strategy. He added that while Timken has a strong portfolio to win in robotics, it remains open to supplemental technologies.

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Angel Castillo's questions to UNITED RENTALS (URI) leadership

Angel Castillo's questions to UNITED RENTALS (URI) leadership • Q2 2025

Question

Angel Castillo of Morgan Stanley asked if the recent tax reform is causing a noticeable change in customer behavior or project timelines, and requested an update on the secular trend of rental penetration versus equipment ownership in the current market.

Answer

EVP & CFO William Grace noted that while it's hard to prove causation, customer confidence has remained high and even improved slightly, which could be correlated with the advantageous tax policy. Regarding rental penetration, both Grace and President & CEO Matthew Flannery affirmed their belief that the trend continues to improve, driven by the rental industry's increased reliability, broader product offerings, and value-added services like technology and safety solutions, which make renting a more compelling option than owning.

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Angel Castillo's questions to UNITED RENTALS (URI) leadership • Q4 2024

Question

An analyst on for Angel Castillo asked how much of the noted customer optimism is translating into current activity and what factors customers might be waiting on. He also inquired what the 2025 guidance assumes for smaller, local markets that have been more sensitive to interest rates.

Answer

Executive William Grace clarified that the customer optimism index is a forward-looking sentiment measure, not a gauge of current activity, but its positive trend supports the company's guidance. He cited post-election certainty and expected accommodative monetary policy as positive factors. Executive Matthew Flannery added that the outlook for local markets is generally similar to 2024, highlighting the company's ability to flexibly move fleet to geographies with the strongest demand.

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