Greenbrier Companies

Commentary

Greenbrier: Order Activity Remains Healthy

We hosted virtual investor meetings and a group call with Justin Roberts, Greenbrier’s Vice President Corporate Finance and Treasurer. North American demand remains solid, and the production ramp-up appears set to occur without additional disruptions. In Europe, the Ukrainian conflict seems to have caused transitory headwinds, which, we believe, could create noise. We remain constructive but are slightly cautious in the near term.

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.

Greenbrier FY4Q20: ‘Solid Results’

Greenbrier’s fiscal fourth-quarter 2020 financial results (the company begins its fiscal year on Oct. 1 of the prior year) are based on a “strong liquidity position,” and a $2.4 billion railcar backlog of 24,600 as of Aug. 31, which includes fourth-quarter orders of 2,800 cars valued at approximately $250 million.

Cowen: Railcar Demand Recovery in 2021

In the two weeks following Cowen and Company’s mid-September Transportation and Sustainable Mobility Conference, analyst Matt Elkott, with input from colleagues Adam Kramer and Jason Seidl (Managing Director and Railway Age Wall Street Contributing Editor), noted that railcar inquiries “have ticked up. While translation into orders may not yet be commensurate with inquiries due to election and pandemic uncertainty, there appears to be an improvement in underlying demand” that should carry forward into a recovery in 2021.

Takeaways From Cowen’s 2Q20 Rail Equipment Survey

“Order expectations by the shipper sub-group of railcar buyers were mixed. While a smaller percentage expects to order railcars, the certainty level about ordering has increased. Among railcar suppliers, we favor Trinity for the flexibility of its manufacturing/leasing model, and Greenbrier for its international diversification and cost cutting. GATX’s lease terms offer it some protection.”

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