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The railcar transportation companies have started off 2012 on a hot note. Trinity Industries, Inc. (TRN - Snapshot Report) is expected to grow earnings by the double digits as the backlog continues to grow on its railcar and barge businesses. This Zacks #1 Rank (strong buy) is a rare stock that has both strong earnings growth and is still a value stock with a forward P/E of 13.8.

Trinity Industries operates in multiple industries in the transportation, energy, industrial and construction sectors. The company is one of the leading makers of railcars in North America and also provides railcar leasing services.

The Dallas-based company also manufactures inland barges and is the largest U.S. manufacturer of fiberglass hopper barge covers that are used primarily on grain barges.

The company's construction division makes highway guardrail and crash cushions and flexible post delineators as well as supplies concrete in Texas and neighboring states.

Its energy division makes structural wind tower and tank containers. The tank containers are used for both residential use as well as custom applications in the U.S. and Mexico.

Trinity Beat by 33.3% in Q4

After two straight quarters of earnings misses, on Feb 15, Trinity finally turned it around with a big fourth quarter earnings surprise. Earnings per share were 56 cents compared to the Zacks Consensus of just 42 cents.

Revenue jumped 48% to $941.5 million from $636 million in the fourth quarter of 2010. Once again, strong railcar orders were the big boost as those sales more than doubled year over year.

Railcar sales rose to $453.3 million from $204.6 million a year ago. It shipped about 5,105 railcars in the quarter.

The Rail Group backlog continued to rise, growing to about $2.6 billion and approximately 29,000 railcars. That's up from a backlog of $2.4 billion as of the end of the third quarter.

All of the company's other divisions saw revenue increases as well in the fourth quarter. The company was especially pleased at how quickly the Inland Barge Group rebounded from floods at its Missouri facility in May 2011.

2012 Outlook Is Strong

The double digit earnings growth the company achieved in 2011 is expected to continue into 2012.

Trinity is forecasting 2012 earnings per share between $2.35 and $2.55. It made $1.65 per share in 2011.

Zacks Consensus Estimate for 2012 Rises

Given the strong guidance, it's not surprising that the analysts all moved to revise estimates higher. 4 estimates were raised out of 4 in the last 30 days, pushing the Zacks Consensus Estimate to $2.57 from $2.37.

That is even higher than the company's guidance range.

It is also further earnings growth of 55.6%.

Shares Surge But There's Still Value

When I last covered the company in January, shares were not quite as hot. But 2012 has been good to investors. Shares are near multi-year highs.

Yet, there is still value. Even though the P/E of 13.8 is higher than January when it was just 12.9, it is still under 15, which is the cut-off I use for value stocks.

The company has other solid valuations such as a price-to-book ratio of just 1.5. A P/B under 3.0 usually means value.

It also has a price-to-sales ratio of only 0.9. A P/S under 1.0 can indicate a company is undervalued.

With Trinity, value investors get the rare combination of both attractive valuations and double digit earnings growth.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor of the Turnaround Trader and Insider Trader services. You can follow her on twitter at @TraceyRyniec.

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