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Railcar demand is defying the economic doom and gloom. The Greenbrier Companies (GBX - Free Report) recently delivered a record number of new railcars in the fiscal fourth quarter and the backlog grew. This Zacks #1 Rank (strong buy) is a strong value stock, with a price-to-sales ratio of just 0.5.

Greenbrier makes new railroad freight cars in 3 manufacturing facilities in the United States and Mexico and marine barges at the U.S. location. It also builds new railroad freight cars for European customers through operations in Poland and subcontractor facilities throughout Europe.

The company also repairs and refurbishes freight cars and provides wheels and railcar parts at 38 locations in North America.

Greenbrier Reports Record Revenue in Fiscal Q4

On Nov 3, Greenbrier reported its fiscal fourth quarter results and saw revenue jump 145% to a record $442.7 million from $178.8 million in the year ago quarter. It surprised on the Zacks Consensus Estimate by 24%.

Earnings per share were 52 cents compared to the consensus of 42 cents. It lost 17 cents per share in the prior year's quarter.

You can really see the turnaround in business as new railcar deliveries were a record 4,000 units in the quarter, up from 700 units in the year ago quarter. For fiscal 2011, it delivered 9,400 units compared with just 2500 units in all of 2010.

Greenbrier received orders for another 5300 units, with orders for 19,500 units received during the full fiscal year. The backlog, as of Aug 31, 2011, had grown to 15,400 units. The backlog is valued at about $1.2 billion.

Strong Demand in Fiscal 2012

The growing backlog confirms that the strong demand for railcars will continue into fiscal 2012.

We believe our industry fundamentals are sound, and that several forces are driving new railcar demand that are uncoupled from the more uncertain economic and political environments," said Mark Rittenbaum, CFO.

"Among these forces are stronger railroad balance sheets, truck traffic diversion to rail, replacement demand, and a growing strength in the US energy market, which will continue to create increased demand for covered hopper cars and tank cars," he added.

Zacks Consensus Estimates Jump

The analysts liked what they heard in the earnings report, because 6 out of 10 estimates for fiscal 2012 jumped in the last 7 days to $2.00 from $1.80 per share.

That is massive earnings growth of 238%.

The fiscal 2013 Zacks Consensus also climbed to $2.74 from $2.69 per share in the last week. That is another 37% earnings growth.

Greenbrier Is a Value Stock

Shares of Greenbrier were weak over the summer but have rallied, along with the overall stock market.

Even with the stock surge, Greenbrier is still a value.

The company has a forward P/E of 11.2, which is well under the 15x cut-off I use to determine a value stock.

It also has a price-to-book ratio of only 1.5. A P/B under 3.0 usually indicates value. Its P/S of 0.5 also indicates "value." A P/S ratio under 1.0 usually means a company is undervalued.

With railcar demand expected to remain strong for several years, and a massive backlog that all but guarantees double digit earnings growth in fiscal 2012, it's a good time to be a railcar manufacturer.

Tracey Ryniec is the Value Stock Strategist for She is also the Editor of the Turnaround Trader and Insider Trader services. You can follow her at traceyryniec.

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