Why Rail Transport Company Greenbrier's Shares Are Trading Higher Today

The Greenbrier Companies, Inc. GBX reported the second quarter of FY24 results. 

Revenue declined to $862.7 million from $1.122 billion a year ago but was above the consensus of $843.3 million. 

The company’s lease fleet utilization was 99%, and fleet size increased by 500 to 14,600 units.

GBX has secured orders for 5,900 new railcars worth $690 million and delivered 5,600 units in the quarter. 

As of February 29, 2023, the new railcar backlog stood at 29,200 units with an estimated value of $3.6 billion.

EBITDA came in at $95.0 million, with a margin of 11%. EPS of $1.03 topped the consensus of $0.86.

As of February 29, 2024, cash and equivalents stood at $272 million.

Dividend: The company’s quarterly dividend per share of 30 cents is payable on May 14, 2024, to shareholders of record as of April 23, 2024.

FY24 Outlook: Greenbrier now expects revenue of $3.50 billion – $3.70 billion (vs. $3.40 billion – $3.70 billion earlier) vs. consensus of $3.52 billion. 

The company expects to deliver 23,500 – 25,000 units (vs. 22,500 – 25,000 units earlier), including around 1,400 units in Brazil.

GBX now projects capital expenditures of around $140 million in Manufacturing and $15 million in Maintenance Services and sees gross leasing investment of about $350 million in Leasing & Management Services. 

The company now anticipates proceeds from equipment sales of around $75 million.

Lorie L. Tekorius, CEO and President said, “Greenbrier’s broad product lineup, extensive market relationships, supportive customer experience, and deep commercial origination capabilities combine to create our unique leadership position and enable ongoing success.”

“These factors provide revenue visibility while supporting our profitable leasing business, which is growing through the disciplined investment in our leased railcar fleet and robust lease renewals.”

Investors can gain exposure to the stock via First Trust RBA American Industrial Renaissance ETF AIRR and Invesco S&P Smallcap 600 Pure Value ETF RZV.

Price Action: GBX shares are up 1.47% at $53.17 on the last check Friday.