RAIL reported earnings of $.71 that easily smashed the $.13 estimate. Most astonishing were the rail car deliveries and backlog growth compared to last year and even last quarter.
- Q4'11 - 2,489 units
- Q3'11 - 1,515 units
- Q4'10 - 694 units
- Q4'11 - 8,303 units
- Q3'11 - 6,311 units
- Q4'10 - 2,054 units
It appears that most of the growth is related to a eastern coal car replacement cycle. Demand evidently jumped as more eastern coal is being shipped internationally. Getting that coal to ports evidently takes more railcars or just newer railcars. The big problem is that coal demand has slowed making the replacement cycle a big question especially to jump into a stock up 20%.
Interesting information but investors need to beware.
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