Latest news with #GATX
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3 days ago
- Business
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1 Surging Industrials Stock for Long-Term Investors and 2 to Steer Clear Of
Each stock in this article is trading near its 52-week high. These elevated prices usually indicate some degree of investor confidence, business improvements, or favorable market conditions. While momentum can be a leading indicator, it has burned many investors as it doesn't always correlate with long-term success. All that said, here is one stock we think lives up to the hype and two that may correct. One-Month Return: -1% Founded in 1967, Fastenal (NASDAQ:FAST) provides industrial and construction supplies, including fasteners, tools, safety products, and many other product categories to businesses globally. Why Are We Wary of FAST? Sales trends were unexciting over the last two years as its 3.3% annual growth was below the typical industrials company Performance over the past two years shows its incremental sales were less profitable, as its 1.5% annual earnings per share growth trailed its revenue gains Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 6 percentage points Fastenal is trading at $40.80 per share, or 37.2x forward P/E. Dive into our free research report to see why there are better opportunities than FAST. One-Month Return: +6.3% Originally founded to ship beer, GATX (NYSE:GATX) provides leasing and management services for railcars and other transportation assets globally. Why Does GATX Give Us Pause? Demand for its offerings was relatively low as its number of active railcars has underwhelmed Free cash flow margin shrank by 32.2 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive 9× net-debt-to-EBITDA ratio shows it's overleveraged and increases the probability of shareholder dilution if things turn unexpectedly GATX's stock price of $156.35 implies a valuation ratio of 17.3x forward P/E. To fully understand why you should be careful with GATX, check out our full research report (it's free). One-Month Return: +20.7% Providing body cameras and tasers for first responders, AXON (NASDAQ:AXON) develops technology solutions and weapons products for military, law enforcement, and civilians. Why Will AXON Beat the Market? Unit sales averaged 32% growth over the past two years and imply healthy demand for its products Free cash flow margin expanded by 20.3 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends Historical investments are beginning to pay off as its returns on capital are growing At $750 per share, Axon trades at 127.4x forward P/E. Is now the time to initiate a position? Find out in our full research report, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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6 days ago
- Business
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Wells Fargo Signs a Deal to Sell its $4.4 Billion Rail Asset Portfolio
The $4.4 billion rail equipment leasing division of Wells Fargo & Company (NYSE:WFC) will be sold to a joint venture between Brookfield Infrastructure and GATX Corporation. A team of bankers in suits, discussing the success of the company's banking products. The agreement covers the whole rail operating lease portfolio, which consists of about 105,000 railcars, as well as the rail finance leasing portfolio, which consists of 440 locomotives and 23,000 railcars. According to Wells Fargo & Company (NYSE:WFC), the deal fits with its plan to streamline operations and will not have a significant effect on its financials. Brookfield Infrastructure will own 70% of the business, with the possibility that GATX Corporation may eventually acquire the entire company. GATX Corporation will oversee operations and initially hold a 30% stake in the business. It's anticipated that the deal will close by Q1 2026. David Marks, executive vice president, Wells Fargo & Company (NYSE:WFC) Commercial Banking, commented: "This transaction is consistent with Wells Fargo's ongoing strategy of simplifying our businesses and focusing on products and services that are core to our clients," GATX Corporation acquires operational control, strengthening Brookfield Infrastructure's capital depth and its freight transport infrastructure network. While we acknowledge the potential of WFC to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than WFC and that has 100x upside potential, check out our report about this READ NEXT: and . Disclosure. None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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6 days ago
- Business
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Wells Fargo to sell its railcar business for $4.4 billion
Wells Fargo has decided to exit its industry-leading position in the rail equipment leasing market, agreeing to sell its portfolio of railcars to a new joint venture for $4.4 billion. The joint venture between GATX Corp. and Brookfield Infrastructure is financing a portion of the transaction with debt — namely a $3.2 billion term loan and a $250 million revolving credit facility provided by a consortium of lenders, including Wells Fargo Securities. David Marks, an executive vice president with Wells Fargo Commercial Banking, described the deal in a press release as being "consistent with Wells Fargo's ongoing strategy of simplifying our businesses and focusing on products and services that are core to our clients." A Wells spokesperson declined to comment further. The core of Wells' rail equipment leasing assets consists of 105,000 rail cars, which will be managed by Chicago-based GATX, itself a leading rail equipment lessor. Toronto-based Brookfield, one of the world's biggest infrastructure investors, is also acquiring a portfolio of 23,000 rail cars and 440 locomotives from Wells as part of the deal. GATX will manage all of the assets included in the deal. The company will start with a 30% ownership stake in the joint venture, but it holds an option to acquire Brookfield's 70% stake over the next 10 years. "This is a really powerful element of the transaction," GATX President and CEO Robert Lyons said Friday on a conference call with analysts. "It allows us to phase in our investment over time, ensuring we can finance our initial stake and future call options via ordinary cash flows and financing activity." While Wells has been active in rail equipment leasing for more than three decades, its involvement deepened significantly after 2008. First, it acquired First Union Rail as part of its 2008 merger with Wachovia. It expanded further in 2016 by acquiring GE Railcar Services, and it renamed its business Wells Fargo Rail. GATX's Lyons described Wells as "a very experienced, sophisticated lessor with a diversified fleet." The San Francisco-based bank's concentration in freight cars dovetails nicely with GATX's existing emphasis on tanker cars to create a better-balanced combined fleet, Lyons added. "This [deal] makes GATX the unquestioned leader in this space," Paul Titterton, president of GATX's Rail North America subsidiary, said on the conference call. The deal with Wells is expected to close in the first quarter of 2026, though GATX is hopeful that it can be completed more quickly. "We're all motivated to make it happen sooner," Lyons said. For Wells, the sale of its rail equipment assets fits into a larger simplification trend. The $1.9 trillion-asset company has been narrowing its focus to business lines that it believes provide the best pathway to increased growth and profitability. "I had the opportunity with this management team, when we came to the company, to decide what we think fits and what didn't," Wells CEO Charlie Scharf said Wednesday during a presentation at a conference in New York. "We exited businesses that we thought were low-returning businesses over the cycles. We exited businesses that we didn't think had the right kind of growth rates that didn't make sense for us to invest in." Wells is the second big bank in the past two years to announce a plan to exit the rail equipment leasing business. PNC Financial Services Group struck a deal to sell its railcar portfolio to Amergin Rail in September 2023. According to GATX, rail equipment lessors control about 57% of the nearly 1.7 million railcars in North America. Financial institutions have traditionally been active in the business, and a number of them remain so — most prominently First Citizens BancShares, through its CIT Rail subsidiary, and JPMorgan Chase. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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7 days ago
- Business
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Why Is GATX (GATX) Stock Soaring Today
Shares of leasing services company GATX (NYSE:GATX) jumped 10% in the afternoon session after it struck a $4.4 billion deal to buy about 105,000 railcars from Wells Fargo through a new joint venture with Brookfield Infrastructure Partners. The deal is expected to expand GATX's North American railcar fleet, enhancing its market position and diversification. GATX is expected to initially hold 30% ownership, with the option to gain full control over time. The deal is expected to lift earnings slightly in the first full year. Is now the time to buy GATX? Access our full analysis report here, it's free. GATX's shares are not very volatile and have only had 5 moves greater than 5% over the last year. Moves this big are rare for GATX and indicate this news significantly impacted the market's perception of the business. The biggest move we wrote about over the last year was 7 months ago when the stock gained 8% on the news that the company reported a "beat and raise" quarter, with revenue and EPS exceeding analysts' expectations. Looking ahead, the company provided full-year revenue guidance that outperformed Wall Street's estimates and raised its full-year EPS guidance. Notably, demand for railcars remained strong, with North America's fleet utilization at 99.3% and the renewal success rate above 80%. Zooming out, we think this quarter featured some important positives. GATX is up 5.5% since the beginning of the year, and at $160.32 per share, it is trading close to its 52-week high of $167.38 from January 2025. Investors who bought $1,000 worth of GATX's shares 5 years ago would now be looking at an investment worth $2,590. Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
7 days ago
- Business
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Wells Fargo to sell rail leasing business
Wells Fargo will sell its rail leasing equipment business to a new joint venture of GATX Corp. and Brookfield Infrastructure, the financial company announced Thursday. The joint venture will purchase approximately 105,000 railcars for $4.4 billion; Brookfield (NYSE: BIP) will separately acquire the Wells Fargo (NYSE: WFC) rail finance portfolio of approximately 23,000 cars and 400 locomotives, according to GATX. 'This transaction is consistent with Wells Fargo's ongoing strategy of simplifying our businesses and focusing on products and services that are core to our clients,' David Marks, executive vice president with Wells Fargo Commercial Banking, said in a press release. GATX (NYSE: GATX) will own 30% of the joint venture and will manage the equipment from both the joint venture and the separate Brookfield transaction. GATX, which has an extensive international rail equipment leasing business, has an option to eventually acquire 100% ownership of the joint venture.'This is an outstanding opportunity to build on GATX's leading North American platform,' GATX CEO Robert C. Lyons said in a press release. '… Importantly, by acquiring the assets in this manner, we will maintain the financial flexibility and capacity to continue growing all of our businesses while capitalizing on the value creation opportunities inherent in the assets acquired.' Brookfield, an international firm with 67% of its operations in North America, is owner of shortline holding company Genesee & Wyoming. Its holdings operate more than 22,500 miles of rail lines worldwide. The transaction is expected to close by the first quarter of 2026. Related:Railcar lessor GATX profit up on fleet utilization, lease renewal rates The post Wells Fargo to sell rail leasing business appeared first on FreightWaves. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
