Analyzing Freightcar America (RAIL) and Its Peers

Freightcar America (NASDAQ:RAIL) is one of 14 publicly-traded companies in the “TRANS – EQP&LSNG” industry, but how does it weigh in compared to its peers? We will compare Freightcar America to similar businesses based on the strength of its earnings, risk, analyst recommendations, valuation, institutional ownership, profitability and dividends.

Profitability

This table compares Freightcar America and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Freightcar America	-2.21%	-14.89%	6.92%
Freightcar America Competitors	10.20%	4.81%	2.75%

Volatility & Risk

Freightcar America has a beta of 2.19, meaning that its share price is 119% more volatile than the S&P 500. Comparatively, Freightcar America’s peers have a beta of 1.02, meaning that their average share price is 2% more volatile than the S&P 500.

Insider and Institutional Ownership

32.0% of Freightcar America shares are owned by institutional investors. Comparatively, 86.4% of shares of all “TRANS – EQP&LSNG” companies are owned by institutional investors. 28.7% of Freightcar America shares are owned by company insiders. Comparatively, 10.3% of shares of all “TRANS – EQP&LSNG” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Freightcar America and its peers top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Freightcar America	$559.42 million	-$75.82 million	-13.10
Freightcar America Competitors	$3.74 billion	$360.72 million	21.44

Freightcar America’s peers have higher revenue and earnings than Freightcar America. Freightcar America is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Freightcar America and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Freightcar America	1	0	1	1	2.67
Freightcar America Competitors	130	572	999	66	2.57

Freightcar America currently has a consensus target price of $9.00, indicating a potential downside of 1.85%. As a group, “TRANS – EQP&LSNG” companies have a potential upside of 10.33%. Given Freightcar America’s peers higher probable upside, analysts clearly believe Freightcar America has less favorable growth aspects than its peers.

Summary

Freightcar America peers beat Freightcar America on 8 of the 13 factors compared.

Freightcar America Company Profile

FreightCar America, Inc., through its subsidiaries, engages in design, manufacture, and sale of railcars and railcar components for the transportation of bulk commodities and containerized freight products in the United States and Mexico. It operates in two segments, Manufacturing and Parts. The company offers a range of railcars, including open top hoppers, mill gondola cars, intermodal and non-intermodal flat cars, coal cars; bulk commodity cars covered hopper cars, coil steel cars, boxcars, woodchip hoppers, aluminum vehicle carriers, and articulated bulk container railcars. It also sells used railcars; rebuilds, converts, and leases railcars; and sells forged, cast, and fabricated parts for various railcars. The company's customers primarily include shippers, railroads, and financial institutions. FreightCar America, Inc. was founded in 1901 and is headquartered in Chicago, Illinois.