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Why Is Gatx (GATX) Up 11.6% Since Last Earnings Report?
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It has been about a month since the last earnings report for Gatx (GATX - Free Report) . Shares have added about 11.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Gatx due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
GATX Q3 Earnings Lag Estimates
Quarterly earnings of $1.12 per share lagged the Zacks Consensus Estimate of $1.15. The bottom line improved 0.9% year over year. Revenues of $321 million missed the Zacks Consensus Estimate of $321.7 million but improved 2.4% year over year.
Lease revenues of $292.4 million grew 2.9% year over year. While Marine operating revenues decreased 4% to $4.8 million, revenues from other sources fell 3.3% to $23.8 million. Total expenses (on a reported basis) declined by $0.1 million to $233.5 million.
Profits in the Rail North American segment declined to $64.3 million from $66.5 million a year ago. The renewal lease rate change of GATX’s Lease Price Index (LPI) was 37.5% in the reported quarter against the year-ago quarter’s -8.1%. The average lease renewal term for cars included in the LPI was 33 months compared with 32 months a year ago.
Rail North America’s wholly-owned fleet consisted of approximately 111,500 rail cars at the end of Sep 30, 2022. Fleet utilization was 99.6% compared with 99.2% at the end of third-quarter 2021.
In the Rail International segment, profits fell 46.2% year over year to $14.5 million in the third quarter. Results were unfavorably impacted by foreign currency exchange rate fluctuations, partially offset by more railcars on lease.
GATX Rail Europe’s fleet totaled around 27,700 rail cars at the end of the quarter. Fleet utilization was 99.4% in the reported quarter compared with 98.1% at the end of third-quarter 2021.
The Portfolio Management unit reported a segmental profit of $11.2 million in the third quarter compared with $6.2 million in the year-ago quarter.
As of Sep 30, 2022, GATX had cash and cash equivalents of $596.3 million compared with $180.3 million at the end of June 2022.
GATX anticipates full-year earnings at the upper end of its announced guidance of $5.60-$6.00 per share.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
VGM Scores
At this time, Gatx has a subpar Growth Score of D, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Gatx has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Gatx (GATX) Up 11.6% Since Last Earnings Report?
It has been about a month since the last earnings report for Gatx (GATX - Free Report) . Shares have added about 11.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Gatx due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
GATX Q3 Earnings Lag Estimates
Quarterly earnings of $1.12 per share lagged the Zacks Consensus Estimate of $1.15. The bottom line improved 0.9% year over year. Revenues of $321 million missed the Zacks Consensus Estimate of $321.7 million but improved 2.4% year over year.
Lease revenues of $292.4 million grew 2.9% year over year. While Marine operating revenues decreased 4% to $4.8 million, revenues from other sources fell 3.3% to $23.8 million. Total expenses (on a reported basis) declined by $0.1 million to $233.5 million.
Profits in the Rail North American segment declined to $64.3 million from $66.5 million a year ago. The renewal lease rate change of GATX’s Lease Price Index (LPI) was 37.5% in the reported quarter against the year-ago quarter’s -8.1%. The average lease renewal term for cars included in the LPI was 33 months compared with 32 months a year ago.
Rail North America’s wholly-owned fleet consisted of approximately 111,500 rail cars at the end of Sep 30, 2022. Fleet utilization was 99.6% compared with 99.2% at the end of third-quarter 2021.
In the Rail International segment, profits fell 46.2% year over year to $14.5 million in the third quarter. Results were unfavorably impacted by foreign currency exchange rate fluctuations, partially offset by more railcars on lease.
GATX Rail Europe’s fleet totaled around 27,700 rail cars at the end of the quarter. Fleet utilization was 99.4% in the reported quarter compared with 98.1% at the end of third-quarter 2021.
The Portfolio Management unit reported a segmental profit of $11.2 million in the third quarter compared with $6.2 million in the year-ago quarter.
As of Sep 30, 2022, GATX had cash and cash equivalents of $596.3 million compared with $180.3 million at the end of June 2022.
GATX anticipates full-year earnings at the upper end of its announced guidance of $5.60-$6.00 per share.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
VGM Scores
At this time, Gatx has a subpar Growth Score of D, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Gatx has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.