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Genesee & Wyoming (GWR) Posts Lackluster Traffic in April


Genesee & Wyoming GWR reported disappointing traffic figures for April. Traffic in the month was 255,647 carloads, reflecting a 5.4% decline year over year. The company’s same railroad traffic (excluding carloads from the Continental European intermodal business sold in June 2018) inched down 0.3%.

Segmental Traffic

Traffic at the company’s North American operations increased 2.9% from the year-ago figure due to improvement in traffic across most segments. Also, traffic at intermodal, agricultural products, chemicals & plastics, minerals and stone, petroleum products and waste divisions was impressive. Meanwhile, segments like autos and auto parts, metallic ores, coal and coke reported a decline in traffic.

Australian operations’ (owned 51.1% by the company) traffic declined 10.6% primarily owing to 65.9% and 26.1% slump in traffic at agricultural products and petroleum products, each. Other segments like coal and coke, intermodal, minerals and stone also reported a fall in the metric.

Total traffic at U.K./European operations decreased 15.5% from the last April-level due to decline in traffic across all its segments, except agricultural products.

Notably, Genesee & Wyoming’s lackluster traffic numbers come close on the heels of its below-par first-quarter 2019 performance, wherein results were hurt by bad weather conditions. In the quarter, the company reported lower-than-expected earnings and revenues.

A glimpse of the company’s price performance over the past month reflects its struggles. Shares of Genesee & Wyoming have declined 1% against its industry's 2.7% growth.

Zacks Rank & Key Picks

Genesee & Wyoming carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the Zacks Transportation sector are SkyWest SKYW, GATX Corporation GATX and Trinity Industries TRN. While SkyWest sports a Zacks Rank #1 (Strong Buy), GATX and Trinity carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of SkyWest and GATX have gained more than 2% and 3%, respectively, in a year’s time.

Trinity Industries has an impressive earnings surprise history, having outperformed the Zacks Consensus Estimate in three of the last four quarters, the average beat being 10.9%.

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