Remember FreightCar America, RAIL, went public on April 6, 2005 at $20.25. It was very quiet IPO and I did not hear of the company until the summer. And I did not buy until the fall of 2005.
At the time the earnings were turning around, and America was clamoring for a cheap, reliable, domestic energy source to counter the high price of imported oil that was hammering the world energy prices that year. My mind immediately thought of coal, specifically plentiful, and dependable western US - low sulphur - coal. The stuff is mined in the Powder River basin of WY and the western slope of CO, so it has to be transported to the power generating plants in the eastern US by the railroads. This is where RAIL and its aluminum gondola railcars comes in. It is no secret the railroads became very profitable early this decade, and its no secret the railroads had neglected to upgrade their rolling stock and tracks for many years, but could now afford to upgrade. So many secular facts favor RAIL's profitability.
And I believe RAIL's price will follow its earnings.
I based my thinking of these prospects and the financial results of RAIL. FreightCar America has pulled off a magnificent turnaround over the last couple of years, and is a US success story. Too bad it has not got the attention it deserves.
Here are the Revenues, Net Income, earns per share for 2003-2006.
,000s omitted
yr Revs Net Income eps
2003 244,349 - 8,483 -1.23
2004 482,180 -25,922 -3.76
2005 927,127 45,382 4.08
2006 1,444,800 128,733 10.07 |
