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Trinity Industries, Inc.

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Trinity reported better-than results in the fourth quarter of 2018. Results were aided by strong segmental performances. We are also impressed by the company's decision to hike its quarterly dividend by more than 18% to 13 cents per share in May 2017. We are positive on Trinity's decision to spin-off its infrastructure-related business as well. The transaction, completed on Nov 1, 2018, enables Trinity to focus on its core area of strength. The company's focus on its integrated rail manufacturing, leasing, and services operations are encouraging. The earnings beat in the fourth quarter is the third one by the company in the previous four quarters. The average beat is 17.7%. On the flip side, we remain concerned about the railcar-related pricing pressure at Trinity Industries' Rail Group, which accounts for bulk of its revenues.

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