), a leader in leasing transportation assets, is all set to unveil
its third-quarter 2012 results on Thursday, October 18, 2012,
before the opening bell. The current Zacks Consensus Estimate for
the third quarter is pegged at 66 cents per share, representing an
annualized decline of 2.09%.
With respect to earnings surprises, GATX Corp. has outperformed
the Zacks Consensus Estimate in the trailing four quarters with an
average earnings surprise of 23.58%.
Second Quarter Recap
On July 19, 2012, GATX reported its second-quarter 2012
financial results. Quarterly adjusted earnings of 80 cents per
share were well ahead of the Zacks Consensus Estimate of 61 cents
and also shot up 86% from 43 cents per share in the year-ago
quarter. This upside was primarily driven by higher lease rates,
better asset utilization and improvement in lease terms along with
higher demand for locomotives.
Revenues for the second quarter increased 9% year over year to
$343 million and surpassed the Zacks Consensus Estimate of $338
million, aided by lease rates, North American fleet utilization and
growth in the lease period.
Agreement of Estimate Revisions
Over the last 30 days, none out of the five analysts covering
the stock revised their EPS estimates for the third and fourth
quarter of 2012.
For fiscal 2012, in the last 30 days, none of the four analysts
covering the stock changed their EPS estimates. Likewise, for
fiscal 2013, none out of the five analysts covering the stock
revised their EPS estimates.
Magnitude of Estimate Revisions
For the third and fourth quarter of 2012, over the last 30 days,
the current Zacks Consensus Estimate was in line with the previous
estimates of 66 and 64 cents, respectively. Similarly, for fiscal
2012 and 2013, the current Zacks Consensus Estimates were flat with
the earlier estimates of $2.78 and $3.22, respectively.
In the previous quarter, GATX Corp. reported EPS of 80 cents,
which beat the Zacks Consensus Estimate by a huge margin of 19
cents. The current Zacks Consensus Estimates for the ongoing
quarter and the upcoming quarter contain upside potential of 0.00%,
respectively (essentially a proxy for future earning surprises).
Likewise, for fiscal 2012 and 2013, the Zacks Consensus Estimate
contains growth potential of 0.00%, respectively.
We expect GATX Corp. to benefit from higher lease rates and
increased asset utilization and remarketing opportunities. The
company's segments remain poised to deliver strong results given
improvements in underlying market fundamentals.
Furthermore, expansion of the company's asset base to enhance
its long-term performance as well as paying higher returns to
shareholders through dividend payments bode well for increased
market traction. However, regulatory pressures and competitive
threats from carriers like
J.B. Hunt Transport Services
) compel us to remain cautious on the stock.
We currently have a long-term Neutral recommendation on GATX.
However, for the short term (1-3 months), the stock has a Zacks #3
GATX CORP (GMT): Free Stock Analysis Report
HUNT (JB) TRANS (JBHT): Free Stock Analysis
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