What Happened?
Shares of rail transportation company Greenbrier (NYSE:GBX) fell 3.1% in the morning session after a series of filings revealed significant stock sales by company insiders and an institutional investor. Recent regulatory filings disclosed that Tectonic Advisors LLC reduced its holdings in the railcar manufacturer by 16.2% during the first quarter.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Greenbrier? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Greenbrier’s shares are somewhat volatile and have had 10 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 14 days ago when the stock gained 19% on the news that the company posted much stronger-than-expected results for its fiscal third quarter and raised its profitability guidance for the full year. The railcar manufacturer reported quarterly earnings of $1.86 per share, handily beating analyst estimates of 98 cents. Sales also beat by a decent margin. The company achieved an aggregate gross margin of 18%, marking the seventh consecutive quarter it has met or exceeded its mid-teens target. Buoyed by the strong performance, Greenbrier raised its full-year guidance for both gross margin and operating margin. The company also highlighted new railcar orders for 3,900 units, valued at over $500 million, and a robust backlog of 18,900 units worth $2.5 billion. Additionally, the board declared its 45th consecutive quarterly dividend and noted ongoing share repurchases.
Greenbrier is down 19.1% since the beginning of the year, and at $49.46 per share, it is trading 30% below its 52-week high of $70.70 from January 2025. Investors who bought $1,000 worth of Greenbrier’s shares 5 years ago would now be looking at an investment worth $1,868.
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