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Greenbrier (GBX) Hits Fresh Highs: Is There Still Room to Run?
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Have you been paying attention to shares of Greenbrier Companies, (GBX - Free Report) ? Shares have been on the move with the stock up 9.5% over the past month. GBX hit a new 52-week high of $54.46 in the previous session. Greenbrier Companies, has gained 1.5% since the start of the year compared to the -3.7% move for the Transportation sector and the -2% year-to-date return for its peer group.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on June 29, 2018, Greenbrier Companies reported EPS of $1.3 versus consensus estimate of $1.14 while it missed the consensus revenue estimate by 4.52%.
For the current fiscal year, Greenbrier Companies is expected to post earnings of $4.18 per share on $2.51 billion in revenues. This represents a 11.17% change in EPS on a 15.86% change in revenues. For the next fiscal year, the company is expected to earn $4.04 per share on $2.41 billion in revenues. This represents a year-over-year change of -3.28% and -3.93%, respectively.
Valuation Metrics
While GBX has moved to its 52-week high in the recent past, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Greenbrier Companies, has a Value Score of A. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 13X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 8.2X versus its peer group's average of 3.7X. Additionally, the stock has a PEG ratio of 1.36. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Greenbrier Companies, Inc. (The) Price and Consensus
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Greenbrier Companies, currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 and Style Scores of A or B, it looks as if Greenbrier Companies, fits the bill. Thus, it seems as though GBX shares could still be poised for more gains ahead.
How Does Greenbrier Companies Stack Up to the Competition?
Shares of Greenbrier Companies, have been moving higher, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also solid potential picks, including Triton International , NABTESCO CP TKY (NCTKF - Free Report) , and Herc Holdings (HRI - Free Report) , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 8% of all the industries we have in our universe, so it looks like there are some nice tailwinds for GBX, even beyond its own solid fundamental situation.
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Greenbrier (GBX) Hits Fresh Highs: Is There Still Room to Run?
Have you been paying attention to shares of Greenbrier Companies, (GBX - Free Report) ? Shares have been on the move with the stock up 9.5% over the past month. GBX hit a new 52-week high of $54.46 in the previous session. Greenbrier Companies, has gained 1.5% since the start of the year compared to the -3.7% move for the Transportation sector and the -2% year-to-date return for its peer group.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on June 29, 2018, Greenbrier Companies reported EPS of $1.3 versus consensus estimate of $1.14 while it missed the consensus revenue estimate by 4.52%.
For the current fiscal year, Greenbrier Companies is expected to post earnings of $4.18 per share on $2.51 billion in revenues. This represents a 11.17% change in EPS on a 15.86% change in revenues. For the next fiscal year, the company is expected to earn $4.04 per share on $2.41 billion in revenues. This represents a year-over-year change of -3.28% and -3.93%, respectively.
Valuation Metrics
While GBX has moved to its 52-week high in the recent past, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Greenbrier Companies, has a Value Score of A. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 13X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 8.2X versus its peer group's average of 3.7X. Additionally, the stock has a PEG ratio of 1.36. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Greenbrier Companies, Inc. (The) Price and Consensus
Greenbrier Companies, Inc. (The) Price and Consensus | Greenbrier Companies, Inc. (The) Quote
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Greenbrier Companies, currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 and Style Scores of A or B, it looks as if Greenbrier Companies, fits the bill. Thus, it seems as though GBX shares could still be poised for more gains ahead.
How Does Greenbrier Companies Stack Up to the Competition?
Shares of Greenbrier Companies, have been moving higher, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also solid potential picks, including Triton International , NABTESCO CP TKY (NCTKF - Free Report) , and Herc Holdings (HRI - Free Report) , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 8% of all the industries we have in our universe, so it looks like there are some nice tailwinds for GBX, even beyond its own solid fundamental situation.