Reporting on Cowen and Co.’s just-concluded 10th Annual Global Transportation Conference, analyst Matt Elkott said that railcar demand recovery is “likely sustainable but not at the same level as second-quarter 2017.” Cowen is projecting third-quarter 2017 orders for 9,400 units, below the second quarter’s 12,000 but significantly higher than the first quarter’s 4,800 and similarly low prior levels.
Demand for new freight cars is on the rise, and builders appear to be aggressively using pricing tools to take advantage of the recovery and retain or increase market share, according to market research conducted by Cowen and Company analyst Matt Elkott.
SMBC Rail Services, LLC on June 1 acquired American Railcar Leasing (ARL); all railcars previously leased from ARL (SHPX and ACFX reporting marks) are now owned or managed by SMBC Rail. In addition, American Railcar Industries (ARI) began to directly manage the ARI fleet (AMFX, SHQX reporting marks).
Cowen and Company analyst Matt Elkott has upgraded American Railcar Industries (ARI) to Outperform from Market Perform, “as earnings and fundamentals have not only remained stable but improved further on the frac sand front. Our confidence in our above-consensus estimates has grown, and our channel checks suggest rising interest in lease fleets. Meanwhile, valuation has compressed over the same period. Our new PT is $45 (16.5x our 2018 EPS estimate) vs. $44 previously.”
On Sept. 30, 2016, the Federal Railroad Administration (FRA) issued a Railworthiness Directive (Directive or RWD) to all owners of Department of Transportation (DOT) specification 111 general purpose tank cars.
American Railcar Industries, Inc. (ARI) reported in the second quarter 2016, decreased revenues in the manufacturing segment were partially offset by increased revenues in the railcar leasing and railcar services segments. Total consolidated revenues were $150.5 million for the second quarter of 2016, a decrease of 22% when compared to $192.0 million for the same period in 2015.
In the current down market, a “strong case” can be made for consolidation in the freight car building sector, according to Cowen and Company analyst Matt Elkott.
St. Charles. Mo.-based American Railcar Industries Inc. reported fourth-quarter net income of $22.7 million, or $1.06 per share, late Wednesday, Feb. 18, 2015, after the closing bell on Wall Street. Net income was up 3% from the comparable quarter in 2013. The results fell short of Wall Street analyst consensus expectations of $1.09 per share.
American Railcar Industries, Inc. (ARI) reported a drop in third-quarter revenue 2014 relative to the comparable period in 2013. St. Charles, Mo.-based ARI announced its results late Wednesday, Oct. 29, 2014, following the closing bell on Wall Street.