Commentary

Rail Equipment Conference Call Takeaways: Cowen

On May 31, we held a discussion with five expert panelists who provided insights into the current state and outlook of the rail, locomotive and railcar leasing and manufacturing markets. Overall, railcar demand recovery has been driven largely by freight cars, but our panelists indicated that tank car utilization and rates are rising. If this continues and eventually leads to higher tank builds, it could be a margin tailwind for manufacturers. As for the broader railcar market, inquiries remain strong, but labor and disruptions could limit production. Locomotive upgrades remain solid.

Matt Elkott
Commentary

Cowen: Wabtec Investor Day Insight

March 9 was Investor Day for Wabtec (WAB), and its five-year margin target is ahead of consensus for the next three years (the maximum available). Revenue and EPS targets are not inconsistent with Street expectations. Cowen and Company believes WAB’s geographic breakout could position it well as some rail commodities shift from Russia to other world regions.

Matt Elkott

Rail Equipment Market: The Cowen Insight

Cowen and Company on Feb. 15 held a webinar with five expert panelists addressing the current state and outlook for the rail, locomotive, and railcar leasing and manufacturing markets.

Commentary

For Railcar Buyers, Time to Pull the Trigger, Soon

Takeaways from Cowen and Company’s recent Rail Equipment Webinar show that locomotive upgrades remain solid, as traffic growth continues. Elevated inquiries for newly built railcars should begin to translate into orders gradually, despite the steel premium. Lessors are well-positioned as freight demand rises, railcar supply decreases and new builds fall short of replacement levels this year.

Commentary

Follow-up Thoughts to “Amid Rising Demand, Who’s ‘Steeling’ the Show”

Here are a few follow-up thoughts to our May 7 report, Car Conundrum: Amid Rising Demand, Who’s “Steeling” the Show. We believe a cyclical inflection point and a number of macro factors could elevate interest

Commentary

Amid Rising Railcar Demand, Who’s ‘Steeling’ the Show?

Railcar demand is on the rise, but so is the price of steel, which Cowen and Company estimates has put a 15%-25% premium on newly built equipment.

Matt Elkott, Cowen and Company OEM Transportation Analyst
Commentary

The Cowen Take on Trinity, Wabtec

Equipment analyst Matt Elkott offers perspectives on two of the rail industry’s biggest OEMs.

For 2020, 2021, and 2022, we are projecting railcar deliveries of 32.2K, 35.9K and 36.2K units, respectively.
Commentary

The Cowen Insight: OEM Earnings, Railcar Demand

At Cowen and Company, we are revising our transportation OEM and machinery earnings estimates for fourth-quarter 2020 and 2021, and introducing our 2022 estimates; updating our North American Class 8 production forecast; and fine-tuning our railcar supply demand model. What are we seeing? Gradually improving supply-side dynamics.

Matt Elkott, Cowen and Company OEM Transportation Analyst
Commentary

Greenbrier ‘Ready for a Railcar Demand Recovery’: Cowen

At Cowen and Company, we expect North American railcar demand to recover in 2021. One of the best-positioned suppliers? The Greenbrier Companies (GBX), with more than a 40% manufacturing share following the acquisition of ARI. Railcar markets in Europe and Brazil are also improving. All of this plus the cost-cutting measures GBX has taken make it our top 2021 pick.

Commentary

Election ‘Blues’ Could Benefit Rail Suppliers

Rail transit rail equipment is among the transportation equipment subsectors most likely to benefit from a potential “Blue Wave” in January following a Joe Biden/Kamala Harris win and the Democrats flipping enough seats in the U.S. Senate in the November Presidential election to take control of that chamber.* As well, a power shift in Washington could drive a public transit service recovery in the U.S.