GATX Corporation (NYSE:GATX) Just Reported And Analysts Have Been Lifting Their Price Targets

Investors in GATX Corporation (NYSE:GATX) had a good week, as its shares rose 8.2% to close at US$167 following the release of its annual results. The result was positive overall - although revenues of US$1.6b were in line with what the analysts predicted, GATX surprised by delivering a statutory profit of US$7.78 per share, modestly greater than expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for GATX

Taking into account the latest results, the most recent consensus for GATX from three analysts is for revenues of US$1.71b in 2025. If met, it would imply a decent 8.0% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to accumulate 8.0% to US$8.64. In the lead-up to this report, the analysts had been modelling revenues of US$1.71b and earnings per share (EPS) of US$8.26 in 2025. So the consensus seems to have become somewhat more optimistic on GATX's earnings potential following these results.

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 8.9% to US$179. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values GATX at US$190 per share, while the most bearish prices it at US$165. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting GATX is an easy business to forecast or the the analysts are all using similar assumptions.

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 8.0% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 5.4% 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. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect GATX to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards GATX following these results. Happily, there were no major changes to revenue forecasts, with the business still expected 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 Simply Wall St, we have a full range of analyst estimates for GATX going out to 2026, and you can see them free on our platform here..

However, before you get too enthused, we've discovered 2 warning signs for GATX (1 is a bit concerning!) that you should be aware 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.