Greenbrier Shares Decline | Glenrock Gazette

Greenbrier Shares Decline

Shares of Greenbrier (GBX) were sharply lower on Tuesday after the transportation manufacturing company posted third-quarter results that missed analysts’ estimates amid continued weakness in its railcar repair business and a delayed rail concession renewal process in Brazil.

The Lake Oswego, Ore.-headquartered company, which manufactures gondolas, boxcars, railcars and tank cars, reported third-quarter revenue of $856.2 million in the three months ended May 31, up from $641.4 million in the same quarter of the prior year but beneath the consensus estimate of analysts polled by Capital IQ for $863.2 million.

Adjusted earnings per share came in at $0.89, down from $1.30 a year earlier and also missing the Street’s forecast for $0.95. Shares of the company were 7% lower in early afternoon trading.

Greenbrier said its current and expected performance had been “consistent” with prior comments that revenue and margin would be back-half weighted this fiscal year.

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But the company’s railcar repair business and certain international operations have seen continued weakness, along with costs from its acquisition of American Railcar Industries, or ARI. Realignment of its railcar repair network is expected to be completed by the end of the year, which would help earnings performance in the wheels, repair and parts segment, Greenbrier said.

The company also faced a delayed rail concession renewal process in Brazil, which weighed on the operations of its joint venture. Pricing and manufacturing performance in Europe responded more slowly than expected, although the company said that it has since started to kick in.

Headwinds from Europe and Brazil are expected to turn to tailwinds in the final quarter of the fiscal year and beyond, along with other international performance contributions, the company said.