Yahoo Finance Here's Why GATX Stock Is a Compelling Portfolio Addition
GATX Corporation’s GATX commitment to reward its shareholders through dividends is encouraging as it has a history of paying dividends since 1919. Strong segmental performance and solid liquidity bode well for the company. If you have not taken advantage of its share price appreciation yet, it’s time to do so.
Let’s take a look at the factors that make the stock a solid investment pick at the moment.
Strong Price Performance: A glimpse at the company’s price trend reveals that its shares have risen 10.8% year to date, surpassing the industry’s 7% growth.
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Solid Rank: GATX currently carries a Zacks Rank #2 (Buy).
Northward Estimate Revision: The Zacks Consensus Estimate for earnings per share has been revised upward by 5.2% over the past 90 days for the current quarter. For the current year, the consensus mark for earnings per share has moved 7.5% north in the same time frame. The favorable estimate revisions indicate brokers’ confidence in the stock.
Impressive Earnings Surprise History: GATX has an impressive earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters and missed once, delivering an average surprise of 7.5%.
Driving Factors: GATX continues to experience robust global demand for most railcar types in its fleet. Strong segmental performance bodes well for the company. In the first quarter of 2024, the Rail International segment reported a $28.8 million profit, indicating 22.6% year-over-year growth. The Rail North America and Engine Leasing segments delivered a profit of $90.3 million and 25.7 million, respectively.
In the first quarter of 2024, GATX’s current ratio (a measure of liquidity) was pegged at 3.39, which represents a solid financial stance. A current ratio of more than 1 indicates that the company has enough cash to meet its debt obligations. The company’s efforts to reward its shareholders are commendable. In January 2024, GATXraised its quarterly dividend by 5.5% to 58 cents per share.
Bullish Industry Rank: The industry to which GATX belongs currently has a Zacks Industry Rank of 54 (out of 249). Such a good rank places GATX in the top 22% of Zacks Industries. Studies show that 50% of a stock price movement is directly related to the performance of the industry group it belongs to.
A mediocre stock within a strong group is likely to outclass a robust stock in a weak industry. Therefore, reckoning the industry’s performance becomes imperative.
Other Stocks to Consider
Some other top-ranked stocks for investors’ consideration in the Zacks Transportation sector include SkyWest SKYW and Kirby Corporation KEX, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
SkyWest has an expected earnings growth rate of 787% for the current year.
SKYW has an impressive earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 128%. Shares of SkyWest have jumped 115.2% in the past year.
KEX has an expected earnings growth rate of 42.2% for the current year.
The company has an encouraging track record with respect to the earnings surprise, having surpassed the Zacks Consensus Estimate in each of the trailing four quarters. The average beat is 10.3%. Shares of Kirby have climbed 59.8% in the past year.
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SkyWest, Inc. (SKYW) : Free Stock Analysis Report
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GATX Corporation (GATX) : Free Stock Analysis Report
