Trinity Industries (TRN) AI Stock Analysis

• Market Cap: $2.04B
• Dividend Yield: 4.64%
• Average Volume (3M): 642.14K
• Price to Earnings (P/E): 15.4
• Beta (1Y): 1.12
• Revenue Growth: -9.40%
• EPS Growth: 8.41%
• Country: US
• Employees: 7,380
• Sector: Industrials
• Sector Strength: 78
• Industry: Railroads
• EPS (TTM): 0.29
• Shares Outstanding: 81,612,960
• 10 Day Avg. Volume: 506,239
• 30 Day Avg. Volume: 642,139
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 3.91
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 11.94
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $27.50
• Price Target Upside: 11.43% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 2

Trinity Industries shows robust financial performance with significant improvements in profitability and cash flow management. However, technical analysis indicates a bearish trend, which may limit short-term gains. Valuation metrics are favorable, offering reasonable pricing and an attractive dividend yield. The earnings call presents mixed sentiment with strong lease fleet performance but challenges in delivery and revenue. Overall, while the fundamentals are strong, market headwinds and technical weakness present potential risks.

Trinity Industries Business Overview & Revenue Model

Company Description

Trinity Industries, Inc. provides rail transportation products and services under the TrinityRail name in North America. It operates in two segments, Railcar Leasing and Management Services Group, and Rail Products Group. The Railcar Leasing and Management Services Group segment leases freight and tank railcars; originates and manages railcar leases for third-party investors; and provides fleet maintenance and management services. As of December 31, 2021, it had a fleet of 106,970 owned or leased railcars. This segment serves industrial shipper and railroad companies operating in agriculture, construction and metals, consumer products, energy, and refined products and chemicals markets. The Rail Products Group segment manufactures freight and tank railcars for transporting various liquids, gases, and dry cargo; and offers railcar maintenance and modification services. This segment serves railroads, leasing companies, and industrial shippers of products in the agriculture, construction and metals, consumer products, energy, and refined products and chemicals markets. It sells or leases products and services through its own sales personnel and independent sales representatives. Trinity Industries, Inc. was incorporated in 1933 and is headquartered in Dallas, Texas.

How the Company Makes Money

Trinity Industries makes money primarily through its two main business segments: the Railcar Leasing and Management Services Group and the Rail Products Group. The Railcar Leasing and Management Services Group generates revenue by leasing railcars to customers across various industries, providing fleet management services, and offering maintenance services. The Rail Products Group contributes to the company's revenue by manufacturing and selling railcars and railcar parts to customers. Additionally, Trinity benefits from long-term leasing contracts and partnerships with key players in the transportation and logistics sectors, which provide a steady and recurring revenue stream. The company's ability to offer both leasing and manufacturing solutions allows it to capitalize on the growing demand for efficient rail transportation.

Trinity Industries Financial Statement Overview

Summary

Trinity Industries has demonstrated strong financial improvement across all areas. The income statement reflects robust growth and improved profitability. The balance sheet shows a healthier financial structure with no debt in 2024, although the equity base remains relatively limited. The cash flow statement highlights excellent cash generation and efficiency. Overall, the company's financial trajectory is positive, with significant improvements in profitability and cash flow management.

Income Statement

Trinity Industries demonstrated strong revenue growth with a 3.22% increase from 2023 to 2024. The gross profit margin improved to 21.70% in 2024, indicating enhanced operational efficiency. The net profit margin also rose to 4.50%, reflecting better profitability. The EBIT and EBITDA margins show significant improvements, underscoring operational resilience. However, the company faced challenges in previous years, including net losses in 2020 and 2021.

Balance Sheet

Trinity Industries has significantly improved its financial position with no total debt by 2024, compared to previous years. The equity ratio stands at 14.80%, indicating a moderate proportion of assets financed by equity. The return on equity is 10.59%, showing a reasonable return for shareholders. However, the company’s equity base is relatively small compared to its total liabilities, which could be a potential risk if not managed carefully.

Cash Flow

The company has shown a remarkable turnaround in its cash flow position, generating a strong operating cash flow of $588.1 million in 2024, with a substantial free cash flow increase from a deficit in 2023 to a positive $588.1 million. The operating cash flow to net income ratio is robust, indicating good cash generation relative to net income. The free cash flow to net income ratio is also favorable, suggesting efficient cash utilization.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.08B	2.98B	1.98B	1.52B	2.00B
	Gross Profit
668.20M	527.10M	367.70M	354.50M	491.00M
	EBIT
491.50M	417.00M	-92.50M	-89.30M	-157.40M
	EBITDA
789.10M	707.70M	458.00M	439.90M	-68.30M
	Net Income Common Stockholders
138.40M	106.00M	98.90M	39.30M	-226.10M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
228.20M	105.70M	79.60M	167.30M	132.00M
	Total Assets
8.83B	8.91B	8.72B	8.24B	8.70B
	Total Debt
5.69B	5.75B	5.61B	5.17B	5.02B
	Net Debt
5.46B	5.65B	5.53B	5.00B	4.88B
	Total Liabilities
7.53B	7.63B	7.45B	6.94B	6.69B
	Stockholders Equity
1.06B	1.04B	1.01B	1.03B	1.74B
Cash Flow		Free Cash Flow
-21.90M	-414.50M	-979.60M	41.00M	-52.80M
	Operating Cash Flow
573.80M	295.60M	-12.80M	611.80M	651.70M
	Investing Cash Flow
-214.60M	-363.00M	-260.70M	276.30M	-532.90M
	Financing Cash Flow
-211.00M	8.20M	265.40M	-814.10M	-168.00M

Trinity Industries Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 24.68
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TRN, the sentiment is Negative. The current price of 24.68 is below the 20-day moving average (MA) of 24.98, below the 50-day MA of 27.37, and below the 200-day MA of 32.55, indicating a bearish trend. The MACD of -0.82 indicates Negative momentum. The RSI at 39.81 is Neutral, neither overbought nor oversold. The STOCH value of 57.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TRN.

Trinity Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WAB	79 Outperform	$32.75B	30.00	10.62%	0.44%	5.21%	24.15%
NSC	76 Outperform	$50.58B	15.32	24.52%	2.41%	0.70%	135.08%
TRN	71 Outperform	$2.04B	15.37	14.14%	4.64%	-9.40%	8.41%
FSTR	70 Outperform	$220.29M	5.24	26.81%	―	-2.39%	2863.06%
GBX	67 Neutral	$1.38B	6.95	14.69%	2.78%	-5.79%	82.71%
Sector *	64 Neutral	$4.27B	11.80	5.32%	249.79%	4.08%	-8.99%
RAIL	52 Neutral	$121.97M	―	156.43%	―	55.84%	-159.47%

Trinity Industries Corporate Events

Trinity Industries Reports Strong Q1 2025 Financial Results

Trinity Industries announced its first quarter 2025 financial results, reporting earnings of $0.29 per diluted share and generating $78 million in operating cash flow. The company delivered 3,060 railcars and maintained a high lease fleet utilization rate of 96.8%. Despite facing external challenges, Trinity achieved a positive Future Lease Rate Differential of 17.9% and continues to see robust demand in its Railcar Leasing and Services segment. The company has a backlog of $1.9 billion and expects industry deliveries of 28,000 to 33,000 railcars in 2025. Management remains confident in the long-term fundamentals of the business, despite short-term impacts from delayed customer ordering decisions.

Spark’s Take on TRN Stock

According to Spark, TipRanks’ AI Analyst, TRN is a Neutral.

Trinity Industries shows strong financial performance with substantial improvements in profitability, cash flow, and a solid balance sheet. However, technical indicators suggest a bearish market trend, which could limit short-term gains. The valuation is reasonable, offering a good dividend yield. The earnings call presents a mixed outlook with both positive performance and potential challenges in the market environment. Overall, the stock is fundamentally strong but faces market headwinds that could impact future performance.

To see Spark’s full report on TRN stock, click here.

Trinity Industries Reports Strong 2024 Financial Results

Trinity Industries, Inc. announced its financial results for the fourth quarter and full year ending December 31, 2024, reporting a full-year GAAP and adjusted earnings from continuing operations of $1.81 and $1.82 per diluted share, respectively. The company experienced a 32% increase in full-year adjusted EPS, attributed to higher lease rates, improved margin performance, and increased external repairs. Trinity delivered 17,570 railcars in 2024 with a year-end backlog of $2.1 billion. Despite a 20% expected decrease in industry deliveries for 2025, Trinity maintains a positive outlook with a projected EPS guidance of $1.50 to $1.80, reflecting continued leasing revenue improvement and consistent operating margins.