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Here's Why Investors Should Add GATX Stock to Portfolio Now
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GATX Corporation’s (GATX - Free Report) gradual improvement in the North American railcar leasing market is impressive. If you haven’t taken advantage of its share price appreciation yet, it’s time you add the stock to your portfolio.
Let’s discuss the factors that make the stock an attractive pick.
Solid Rank: GATX currently carries a Zacks Rank #2 (Buy). Our research shows that stocks with a Zacks Rank #1 (Strong Buy) or #2 offer attractive investment opportunities.
Northward Estimate Revisions: Two estimates for 2023 moved north in the past 60 days versus no southward revision, reflecting analysts’ confidence in the company. The Zacks Consensus Estimate for 2023 earnings has inched up 1% in the past 60 days.
Positive Earnings Surprise History: GATX has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in three of the trailing four quarters (one miss), delivering an earnings surprise of 17.3%, on average.
Strong Growth Prospects: The Zacks Consensus Estimate for 2023 earnings is pegged at $6.94 per share, which reflects year-over-year growth of 14.3%. Moreover, earnings are expected to register 1.1% rise in 2024.
Driving Factors: Gradual improvement in the North American railcar leasing market is a huge positive for GATX. In second-quarter 2023, profits in the Rail North American segment jumped to $79.3 million from $53.1 million a year ago. This was primarily driven by higher lease revenues and increased gains on asset dispositions.
Management expects recovery in the North American railcar leasing market to continue throughout 2023. Rail International’s 2023 segment profit is likely to rise as solid demand for new and existing railcars continues in Europe and India. We expect current-year revenues from railcars in the Rail North American segment to improve 12.8% from 2022 actuals.
In the second quarter of 2023, the Portfolio Management unit reported a segmental profit of $26.6 million against a segmental loss of $15.7 million in the year-ago quarter. This can be attributed to increased earnings from Rolls-Royce and Partners Finance affiliates and GATX Engine Leasing.
Other Stocks to Consider
Some other top-ranked stocks for investors interested in the Zacks Transportation sector are Old Dominion Freight Line (ODFL - Free Report) and Ryder System (R - Free Report) .
Old Dominion’s, which presently carries a Zacks Rank #2 (Buy), efforts to enhance shareholder value are impressive.
Old Dominion is benefiting from strong performance of the LTL segment owing to improved freight conditions.
Ryder, which currently carries a Zacks Rank #2, is benefiting from its consistent efforts to reward shareholders through dividends and share repurchases. You can see the complete list of today’s Zacks #1 Rank stocks here.
Despite weak market conditions, Ryder reported better-than-expected earnings in second-quarter 2023. In fact, the company has an impressive earnings surprise history. R has surpassed the Zacks Consensus Estimate in three of the last four quarters (missing the mark once), the average beat being 11.2%.
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Here's Why Investors Should Add GATX Stock to Portfolio Now
GATX Corporation’s (GATX - Free Report) gradual improvement in the North American railcar leasing market is impressive. If you haven’t taken advantage of its share price appreciation yet, it’s time you add the stock to your portfolio.
Let’s discuss the factors that make the stock an attractive pick.
Solid Rank: GATX currently carries a Zacks Rank #2 (Buy). Our research shows that stocks with a Zacks Rank #1 (Strong Buy) or #2 offer attractive investment opportunities.
Northward Estimate Revisions: Two estimates for 2023 moved north in the past 60 days versus no southward revision, reflecting analysts’ confidence in the company. The Zacks Consensus Estimate for 2023 earnings has inched up 1% in the past 60 days.
Positive Earnings Surprise History: GATX has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in three of the trailing four quarters (one miss), delivering an earnings surprise of 17.3%, on average.
Strong Growth Prospects: The Zacks Consensus Estimate for 2023 earnings is pegged at $6.94 per share, which reflects year-over-year growth of 14.3%. Moreover, earnings are expected to register 1.1% rise in 2024.
Driving Factors: Gradual improvement in the North American railcar leasing market is a huge positive for GATX. In second-quarter 2023, profits in the Rail North American segment jumped to $79.3 million from $53.1 million a year ago. This was primarily driven by higher lease revenues and increased gains on asset dispositions.
Management expects recovery in the North American railcar leasing market to continue throughout 2023. Rail International’s 2023 segment profit is likely to rise as solid demand for new and existing railcars continues in Europe and India. We expect current-year revenues from railcars in the Rail North American segment to improve 12.8% from 2022 actuals.
In the second quarter of 2023, the Portfolio Management unit reported a segmental profit of $26.6 million against a segmental loss of $15.7 million in the year-ago quarter. This can be attributed to increased earnings from Rolls-Royce and Partners Finance affiliates and GATX Engine Leasing.
Other Stocks to Consider
Some other top-ranked stocks for investors interested in the Zacks Transportation sector are Old Dominion Freight Line (ODFL - Free Report) and Ryder System (R - Free Report) .
Old Dominion’s, which presently carries a Zacks Rank #2 (Buy), efforts to enhance shareholder value are impressive.
Old Dominion is benefiting from strong performance of the LTL segment owing to improved freight conditions.
Ryder, which currently carries a Zacks Rank #2, is benefiting from its consistent efforts to reward shareholders through dividends and share repurchases. You can see the complete list of today’s Zacks #1 Rank stocks here.
Despite weak market conditions, Ryder reported better-than-expected earnings in second-quarter 2023. In fact, the company has an impressive earnings surprise history. R has surpassed the Zacks Consensus Estimate in three of the last four quarters (missing the mark once), the average beat being 11.2%.