Earnings Beat: GATX Corporation Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

GATX Corporation (NYSE:GATX) defied analyst predictions to release its quarterly results, which were ahead of market expectations. The company beat forecasts, with revenue of US$405m, some 3.5% above estimates, and statutory earnings per share (EPS) coming in at US$2.43, 24% ahead of expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for GATX

Following the latest results, GATX's dual analysts are now forecasting revenues of US$1.71b in 2025. This would be a decent 11% improvement in revenue compared to the last 12 months. Per-share earnings are expected to accumulate 9.4% to US$8.26. In the lead-up to this report, the analysts had been modelling revenues of US$1.65b and earnings per share (EPS) of US$8.11 in 2025. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a slight bump in to revenue forecasts.

The analysts increased their price target 14% to US$154, perhaps signalling that higher revenues are a strong leading indicator for GATX's valuation.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that GATX's rate of growth is expected to accelerate meaningfully, with the forecast 8.5% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 4.4% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.4% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that GATX is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

We don't want to rain on the parade too much, but we did also find 3 warning signs for GATX (1 makes us a bit uncomfortable!) that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.