GATX Corporation (GATX) Stock Analysis & Winston Score

GATX Corporation owns and leases railcars to companies that need to move goods by train. Its customers include chemical companies, food producers, and energy firms that prefer to rent railcars rather than buy them outright. GATX is one of the largest railcar leasing companies in North America and also has a smaller fleet leasing business in Europe.

GATX makes money by charging customers regular lease payments over multi-year contracts, which creates a steady and predictable stream of revenue. The company operates mainly in the United States, with additional operations in Europe, and manages a fleet of roughly 130,000 railcars. Its competitive advantage comes from the sheer size of its fleet, long customer relationships, and the high cost for customers to switch providers. The key risk the business faces is a slowdown in industrial activity, which reduces demand for railcar leases and can push lease rates lower.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+38.4% YoY

YoY Growth Rate

Revenue accelerating

EPS Growth

+9.3% YoY

YoY Growth Rate

Slow EPS growth

Insider Activity

0.6%ownership

↓ Declining

Insider ownership declining — could be dilution or selling

Cash Runway

~1 months

$741M cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

Short runway — potential dilution ahead through share issuance

Revenue accelerating

GATX Corporation grew revenue 38% year-over-year and the growth rate is speeding up. That's the kind of momentum growth investors look for — the question is whether margins can follow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

45.6%

Healthy — 45.6% gross margin

Operating Margin

29.7%

Excellent — 29.7% operating margin

ROCE

1.1%

Weak — 1.1% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+16.9%

Fast-growing sales (16.9% YoY)

EPS YoY

+18.1%

Earnings growing fast (18.1% YoY)

Healthy double-digit earnings growth — what compounders look like.

EPS Consistency

6/8 quarters

Earnings grew in most of the last 8 quarters

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Cash Flow

Cash Conversion

213%

Turns 213% of profit into real cash

FCF Margin

-253.4%

Burning cash (-253.4%)

Free cash flow is negative. They are burning cash, not generating it.

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Stability

Debt / Equity

4.50

Heavy debt load (4.50)

Interest Cover

1.09x

Dangerous — barely covers interest (1.1x)

Interest coverage between 1 and 3. Profits cover interest, but with little room to spare.

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Valuation

P/E Ratio (TTM)

19.0x

no trend

Fair value — P/E 19.0

P/E in the normal range. Price is roughly $15 for every $1 of yearly profit.

P/E vs Forward

+1.9

GROWING

Earnings expected to grow — slightly cheaper on forward P/E

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Dividends

Dividend Yield

1.48%

no trend

Small dividend — 1.48% yield

Modest yield. The bulk of any return needs to come from price appreciation.

Dividend Growth

+6.7%

no trend

Dividend growing modestly (6.7% YoY)

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