October 24, 2024
Top 10 Stock GATX Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: GATX – Top 10 Stock in Employee Health Leaders in the United States
GATX is listed as a top 10 stock on October 24, 2024 in the market index Employee Health US because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment where the risk of paying too much for the shares is low. Based on the Obermatt 360° View of 55 (high 55% performer), Obermatt assesses an overall buy recommendation for GATX on October 24, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Trading & Distribution |
| Index | Dividends USA, Employee Health US, S&P MIDCAP |
| Size class | Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View GATX Buy
| 360 METRICS | October 24, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 55 |
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| GROWTH | ||||||||
| GROWTH | 55 |
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| SAFETY | ||||||||
| SAFETY | 4 |
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| SENTIMENT | ||||||||
| SENTIMENT | 93 |
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| 360° VIEW | ||||||||
| 360° VIEW | 55 |
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ANALYSIS: With an Obermatt 360° View of 55 (better than 55% compared with alternatives), overall professional sentiment and financial characteristics for the stock GATX are above average. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for GATX. The consolidated Value Rank has an attractive rank of 55, which means that the share price of GATX is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 55% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 55, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 93. But the company’s financing is risky with a Safety rank of 4. This means 96% of comparable companies have a safer financing structure than GATX. ...read more
RECOMMENDATION: With a consolidated 360° View of 55, GATX is better positioned than 55% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 55), above-average growth (Growth Rank of 55), and positive market sentiment in the professional investor community (Sentiment Rank of 93), it is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely, unless information not publicly available. Only the company financing structure is on the riskier side (Safety Rank of 4), but that would also mean better returns for shareholders if things work out well. Good value is sometimes an indication that the company's future is challenging. If they have been growing above average and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of GATX is as difficult as the low price of the stock, despite good growth and positive professional investor sentiment, suggests. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible right now, which may indicate good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for GATX very positive
ANALYSIS: With an Obermatt Sentiment Rank of 93 (better than 93% compared with alternatives) for 2022, overall professional sentiment and engagement for the stock GATX is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all four indicators above average for GATX. Analyst Opinions are at a rank of 64 (better than 64% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive with a rank of 50, which means that stock research experts are changing their opinions for the better and recommending investing in the company. They are getting more optimistic about stock investments in GATX. The Professional Investors rank is 93, which means that currently, professional investors hold more stock in this company than in 93% of alternative investment opportunities. Pros tend to favor investing in this company. Finally, Market Pulse has a rank of 94 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 94% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 93 (more positive than 93% compared with investment alternatives), GATX has a reputation among professional investors that is significantly higher than that of its competitors. Since all market sentiment indicators are positive, the professional community highly recommends investment in the company. Does this mean GATX stocks are a safe investment? Far from it. Even professionals make mistakes. Especially in stock investing, there is a tendency to follow the leaders. Since trees don't grow to the heavens, such positive sentiment may also be interpreted as a danger sign. A lot of optimism can often be a sign of troubles to come, albeit unforeseen by most. ...read more
Value Strategy: GATX Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 55 (better than 55% compared with alternatives), GATX shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for GATX. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 57 which means that the stock price compared with what market professionals expect for future profits is lower than for 57% of comparable companies, indicating a good value concerning GATX's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 58, and for Dividend Yield with a Dividend Yield Rank of 85. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 83% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 17). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 55, is a buy recommendation based on GATX's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that GATX has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing GATX shares. ...read more
Growth Strategy: GATX Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 55 (better than 55% compared with alternatives), GATX shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, where half of the indicators are below and half above average for GATX. Profit Growth, with a rank of 81 (better than 81% of its competitors), and Capital Growth, with a rank of 65, are both positive, which is a healthy sign for positive development. But Sales Growth has only a rank of 38, which means that, currently, professionals expect the company to grow less than 62% of its competitors, and Stock Returns are at a rank of 39. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 55, is a buy recommendation for growth and momentum investors. Stock returns that are a thing of the past can be less of a problem. Below-average revenue growth may be caused by divestments of underperforming businesses. If that is the case, then the positive developments of profit and capital growth are signs of a company with growth potential. If these are the reasons, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: GATX Debt Financing Safety risky
| SAFETY METRICS | October 24, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 6 |
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| REFINANCING | ||||||||
| REFINANCING | 38 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 1 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 4 |
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ANALYSIS: With an Obermatt Safety Rank of 4 (better than 4% compared with alternatives), the company GATX has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of GATX is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for GATX. Liquidity is at 1, meaning that the company generates less profit to service its debt than 99% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 6, meaning the company has an above-average debt-to-equity ratio. It has more debt than 94% of its competitors. Finally, Refinancing is at a rank of 38 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 62% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 4 (worse than 96% compared with alternatives), GATX has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: GATX Top Financial Performance
| COMBINED PERFORMANCE | October 24, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 55 |
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| GROWTH | ||||||||
| GROWTH | 55 |
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| SAFETY | ||||||||
| SAFETY | 1 |
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| COMBINED | ||||||||
| COMBINED | 76 |
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ANALYSIS: With an Obermatt Combined Rank of 76 (better than 76% compared with investment alternatives), GATX (Trading & Distribution, USA) shares have much better financial characteristics than comparable stocks. Shares of GATX are a good value (attractively priced) with a consolidated Value Rank of 55 (better than 55% of alternatives), show above-average growth (Growth Rank of 55) but are riskily financed (Safety Rank of 4), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 76, is a strong buy recommendation based on GATX's financial characteristics. As the company GATX's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 55) and above-average growth (Obermatt Growth Rank of 55), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 4) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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