Ahead of the Bell: Greenbrier Cos. upgraded

Sterne Agee analyst upgrades Greenbrier to 'Buy' predicting growth, better profitability

Associated Press

NEW YORK (AP) -- A Sterne Agee analyst on Tuesday upgraded railcar maker Greenbrier Cos. to "Buy" from "Neutral," predicting strong growth and profitability improvements down the road.

Sal Vitale, who also boosted his price target by $12 to $26, said that after a year of relatively flat non-tank railcar orders, he expects significant increases in orders that will boost Greenbrier's backlog and earnings per share over the next two to three years.

Meanwhile, demand for tank cars, which increased significantly in 2012, will continue to grow this year and demand for other types of cars, such as those designed to carry automobiles, also will increase, he said.

Vitale added that the Lake Oswego, Ore., company should also get a boost from its own plan to boost profitability by the end of fiscal 2014 by shifting its focus toward more profitable products, lower raw material costs and a restructuring of its wheel services business.

The upgrade follows another one last week from KeyBanc analyst Steve Barger, who set a "Buy" rating and $27 price target on shares. Barger pointed to the railcar company's improving product mix and increased insights into its long-term profitability prospects.

Shares of Greenbrier closed Monday at $21.74. The stock has rallied 34 percent in the year to date.

View Comments (0)