| | | Re: TRN
Below is the competitor screen from Barchart.com
From the group I own TRN, GBX, TRTN & TGH. Owned RAIL in the past but sold it all a few years ago
TRTN & TGH lease/own shipping containers and recently (past 3 years) have been growing their management service business for larger clients. These service revenues have increased their cash flows (and EPS) w/o significant new capital investments (other than in IT management software).
The management and service business for rail cars is similar and is the future growth component for TRN & GBX. Their business is cyclical and capital intensive so you see a lot of one time write downs, large depreciation expenses and high debt/equity.
I look at FCF from the income statement. The DATAROMA site breaks this out and TRN has positive FCF (+21.3M) and GBX is negative (Free Cash Flow (TTM) -446.647M):
I saw this news story on Wednesday:
Trinity (TRN) Acquires Quasar, Expands Trinsight Platform
The acquisition of Quasar, a rail logistics software platform providing real-time data to freight rail shippers and operators, expands Trinity’s digital product portfolio, including Trinsight, by adding capabilities such as yard management, activity-based costing and new data visualization tools. Based on the container companies (TGH & TTRN) entry into management services( a big push in 2019), it looks like TRN is making a similar move. Revenues/employee is larger for TRN (Revenue per Employee (TTM) 259366.9803) vs GBX (Revenue per Employee (TTM) 169777.5728) or almost 50% higher.
That may/could grow more w/ the expansion of their 'Trinsight Platform' service software management platform.
My avg cost for TRN is $16.29/share from buys in 2016. Div yield 3.7%
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TGH & TRTN have had a good run since my Buys in 2019 (TGH avg cost $7.15/share) especially moving into the management service area and the whole supply chain growth.
Will this happen in the rail car service area?
That's my thesis for TRN as I peeled off shares at/above $30/share earlier this year and am now starting to buy those shares back (20% lower). I have been selling TGH & TRTN and think this may be a good area to deploy those funds. Have also moved some of those monies into domestic warehouse REITs.
I like TRN over GBX an my total exposure still quite small less than 0.5% portfolio position combined. |
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