Here's Why Investors Should Add GATX to Their Portfolio

Zacks Equity Research

3 May 2024 at 2:36 pm·3-min read

GATX Corporation (GATX) is benefiting from its shareholder-friendly initiatives through which it rewards its shareholders in the form of dividend payments and share repurchases.

Against this backdrop, let’s look at the factors that make this stock an attractive pick.

What Makes GATX an Attractive Pick?

An Outperformer: A glimpse at the company’s price trend reveals that the stock has had an impressive run on the bourse in the past year. Shares of GATX have gained 18.5% over the past six months.

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Solid Zacks Rank: GATX has a Zacks Rank #2 (Buy). Our research shows that stocks with a Zacks Rank #1 (Strong Buy) or 2 offer the best investment opportunities. Thus, the company is a compelling investment proposition at the moment.

Northward Estimate Revisions:The direction of estimate revisions serves as an important pointer when it comes to the price of a stock. Over the past 90 days, the Zacks Consensus Estimate for 2024 earnings has been revised 3% upward.

Positive Earnings Surprise History: GATX has an encouraging track record with respect to earnings surprise, having surpassed the Zacks Consensus Estimate in three of the last four quarters (missing the mark in the remaining one). The average beat is 7.49%.

Earnings Expectations: Earnings growth and stock price gains often indicate a company’s prospects. For 2024, GATX’s earnings are expected to grow 6.79% year over year.

Growth Factors:GATX, which has been paying regular dividends since 1919, holds an impressive record with respect to dividends and buybacks. Notably, 2024 marks the 106th consecutive year of GATX paying out dividends. Such shareholder-friendly moves instill investor confidence and positively impact the company's bottom line.

Bullish Industry Rank: The industry to which GATX belongs currently has a Zacks Industry Rank of 16 (250 plus groups). Such a good rank places GATX in the top 6% of Zacks Industries. Studies show that 50% of a stock price movement is directly related to the performance of the industry group it belongs to.

A mediocre stock within a strong group is likely to outclass a robust stock in a weak industry. Therefore, reckoning the industry’s performance becomes imperative.

Other Stocks to Consider

Some other top-ranked stocks for investors’ consideration in the Zacks Transportation sector include Air Lease AL and Wabtec Corporation WAB. Each stock currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Air Lease has an encouraging track record with respect to earnings surprise, having surpassed the Zacks Consensus Estimate in each of the last four quarters. The average beat is 20.15%.

The Zacks Consensus Estimate for 2024 earnings has been revised 25.8% upward over the past 90 days. AL has an expected earnings growth rate of 29.96% for 2024. AL shares have risen 41% in the past year.

Wabtec’s solid performance in the Freight and Transit segments is boosting its top line. The Zacks Consensus Estimate for WAB’s 2024 earnings has improved 28.37% over the past 90 days. Shares of WAB have surged 64.3% in the past year.

WAB’s earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters, delivering an average surprise of 11.46%.

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Air Lease Corporation (AL) : Free Stock Analysis Report

Westinghouse Air Brake Technologies Corporation (WAB) : Free Stock Analysis Report

GATX Corporation (GATX) : Free Stock Analysis Report

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What Makes GATX an Attractive Pick?

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