tiprankstipranks
Trending News
More News >
Trinity Industries (TRN)
NYSE:TRN
Advertisement

Trinity Industries (TRN) AI Stock Analysis

Compare
360 Followers

Top Page

TRN

Trinity Industries

(NYSE:TRN)

Rating:64Neutral
Price Target:
$30.00
▲(5.49% Upside)
Trinity Industries' overall stock score reflects a balanced view of its strengths and challenges. The most significant factor is the mixed financial performance, with strong operational efficiency but concerns over revenue decline and high leverage. Technical analysis shows positive momentum, while the earnings call provided optimism for future growth. Valuation is fair, with an attractive dividend yield. Corporate events indicate strong leadership support.

Trinity Industries (TRN) vs. SPDR S&P 500 ETF (SPY)

Trinity Industries Business Overview & Revenue Model

Company DescriptionTrinity 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 MoneyTrinity Industries generates revenue through several key streams, primarily from the manufacturing and leasing of railcars. The Rail Group is a significant contributor, where the company designs, manufactures, and sells a variety of railcars, including tank cars, freight cars, and intermodal containers. Additionally, the leasing of these railcars provides a recurring revenue stream. The Construction Products Group contributes by selling products like concrete and asphalt, while the Energy Equipment Group derives income from manufacturing equipment utilized in the oil and gas industry. Partnerships with major transportation and energy companies enhance their earnings potential, along with market demand fluctuations in rail and construction sectors impacting revenue generation.

Trinity Industries Earnings Call Summary

Earnings Call Date:Jul 31, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Oct 30, 2025
Earnings Call Sentiment Neutral
Trinity Industries presented a strong performance in its leasing business and managed to maintain positive order momentum in the Rail Products segment despite challenges. Increased cash flow and liquidity position the company well for future growth. However, increased costs, severance expenses, and production adjustments due to lower order volumes present challenges.
Q2-2025 Updates
Positive Updates
Strong Leasing Business Performance
Trinity's leasing business continues to perform exceptionally well with segment revenues increasing both sequentially and year-over-year due to higher lease rates. The future lease rate differential for FRD stands at an impressive 18.3% for the quarter, marking 13 consecutive quarters in double digits.
Rail Products Segment Improvement
The Rail Products segment received orders for 2,310 railcars with a book-to-bill ratio above 1x for the first time in 10 quarters, indicating positive order momentum expected to continue.
Increased Cash Flow and Liquidity
Year-to-date cash flow from continuing operations is $142 million, with $792 million in liquidity. The company is well-positioned for market conditions with significant flexibility.
Optimistic Future Outlook
Trinity expects stronger deliveries in the latter part of the year and into 2026, with expectations of a positive impact from recent tax legislation and trade developments.
Negative Updates
Increased Cost of Revenues
Cost of revenues in the Railcar Leasing and Services segment increased by 13.7% year-over-year due to higher maintenance and compliance expenses.
Severance Expenses
The company incurred approximately $8 million in severance expenses year-to-date, with full-year expectations of $15 million, impacting the Rail Products Group.
Lower Order Volumes and Production Adjustment
Due to lower order volumes in preceding quarters, production was adjusted to match the pace of customers' delayed decisions, resulting in a segment operating margin of 3%.
Company Guidance
During the Trinity Industries Q2 2025 earnings call, CEO Jean Savage and CFO Eric Marchetto provided guidance highlighting several key metrics. Trinity expects the North American railcar industry to achieve full-year deliveries in the range of 28,000 to 33,000 railcars. The Railcar Leasing and Services segment reported a robust performance with a future lease rate differential at 18.3% and a renewal success rate of 89%, maintaining a high fleet utilization of 96.8%. Trinity's Rail Products segment anticipates full-year operating margins between 5% and 6%, supported by strategic initiatives and expected higher deliveries in the latter half of the year. The company also projects full-year EPS guidance of $1.40 to $1.60, factoring in severance expenses. Marchetto emphasized the positive impact of recent tax legislation on cash flow, projecting gains on lease portfolio sales between $50 million and $60 million for the year. The call underscored Trinity's optimism regarding improved order volumes and financial performance in the second half of 2025.

Trinity Industries Financial Statement Overview

Summary
Trinity Industries presents a mixed financial picture. While operational efficiency is evident from strong EBIT and EBITDA margins, declining revenue and high leverage are concerns. The cash flow situation is challenging, with negative free cash flow growth. The company needs to focus on improving revenue growth and managing debt levels to enhance financial stability.
Income Statement
65
Positive
Trinity Industries shows a mixed performance in its income statement. The TTM gross profit margin of 23.18% is decent, indicating effective cost management. However, the net profit margin of 4.10% suggests room for improvement in profitability. The revenue growth rate is negative at -11.74% TTM, indicating a decline in sales, which is a concern. The EBIT and EBITDA margins are relatively strong at 16.92% and 28.80% TTM, respectively, showing operational efficiency.
Balance Sheet
55
Neutral
The balance sheet reveals high leverage with a debt-to-equity ratio of 5.37, indicating significant reliance on debt financing, which poses a risk. The return on equity is modest at 7.46% TTM, reflecting moderate profitability relative to shareholder equity. The equity ratio is not provided, but the high debt levels suggest a lower proportion of equity in the capital structure.
Cash Flow
45
Neutral
Cash flow analysis shows challenges, with a negative free cash flow growth rate of -324.70% TTM, indicating cash outflows. The operating cash flow to net income ratio of 1.91 TTM is strong, suggesting good cash generation relative to net income. However, the free cash flow to net income ratio is negative, highlighting issues in converting profits to free cash flow.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue2.52B3.08B2.98B1.98B1.52B2.00B
Gross Profit600.10M668.20M527.10M367.70M354.50M491.00M
EBITDA653.50M789.10M707.70M458.00M439.90M-68.30M
Net Income96.50M138.40M106.00M98.90M39.30M-226.10M
Balance Sheet
Total Assets8.81B8.83B8.91B8.72B8.24B8.70B
Cash, Cash Equivalents and Short-Term Investments315.30M228.20M105.70M79.60M167.30M132.00M
Total Debt5.86B5.69B5.75B5.61B5.17B5.02B
Total Liabilities7.55B7.53B7.63B7.45B6.94B6.69B
Stockholders Equity1.01B1.06B1.04B1.01B1.03B1.74B
Cash Flow
Free Cash Flow-56.40M-21.90M-414.50M-979.60M41.00M-52.80M
Operating Cash Flow420.10M573.80M295.60M-12.80M611.80M651.70M
Investing Cash Flow-402.30M-214.60M-363.00M-260.70M276.30M-532.90M
Financing Cash Flow-64.80M-219.90M8.20M265.40M-814.10M-168.00M

Trinity Industries Technical Analysis

Technical Analysis Sentiment
Positive
Last Price28.44
Price Trends
50DMA
27.16
Positive
100DMA
26.25
Positive
200DMA
29.82
Negative
Market Momentum
MACD
0.53
Negative
RSI
56.83
Neutral
STOCH
55.68
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TRN, the sentiment is Positive. The current price of 28.44 is above the 20-day moving average (MA) of 28.02, above the 50-day MA of 27.16, and below the 200-day MA of 29.82, indicating a neutral trend. The MACD of 0.53 indicates Negative momentum. The RSI at 56.83 is Neutral, neither overbought nor oversold. The STOCH value of 55.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TRN.

Trinity Industries Risk Analysis

Trinity Industries disclosed 39 risk factors in its most recent earnings report. Trinity Industries reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Trinity Industries Peers Comparison

Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
79
Outperform
$62.81B18.8024.11%1.94%0.71%86.84%
76
Outperform
$275.86M7.8722.67%-7.03%397.79%
71
Outperform
$33.08B28.8810.84%0.49%3.38%17.21%
69
Neutral
$1.44B6.5516.16%2.67%0.71%84.57%
64
Neutral
$2.30B24.7310.47%4.15%-22.95%-40.67%
64
Neutral
$10.74B15.628.14%2.00%2.79%-14.82%
44
Neutral
$163.35M156.43%-6.00%-12.45%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TRN
Trinity Industries
28.44
-2.44
-7.90%
RAIL
Freightcar America
8.39
0.52
6.61%
GBX
Greenbrier
46.44
0.26
0.56%
FSTR
L. B. Foster Company
25.58
6.46
33.79%
NSC
Norfolk Southern
278.25
24.15
9.50%
WAB
Westinghouse Air Brake Technologies
192.62
29.37
17.99%

Trinity Industries Corporate Events

Business Operations and StrategyFinancial Disclosures
Trinity Industries Reports Q2 2025 Earnings and Orders
Neutral
Jul 31, 2025

Trinity Industries reported its second quarter 2025 results, highlighting a quarterly earnings per share of $0.19 and a year-to-date operating cash flow of $142 million. The company received orders for 2,310 railcars and delivered 1,815, with a backlog of $2.0 billion. Despite lower revenues compared to the previous year, Trinity’s leasing business showed robust performance with a lease fleet utilization of 96.8% and a positive future lease rate differential of 18.3%. The company maintained its full-year EPS guidance, reflecting expectations of improved deliveries and continued business improvement.

Executive/Board ChangesShareholder Meetings
Trinity Industries Holds Annual Stockholder Meeting
Positive
May 19, 2025

On May 15, 2025, Trinity Industries, Inc. held its annual meeting of stockholders, where three proposals were voted on. The stockholders elected eight directors for a one-year term, approved executive officer compensation, and ratified the appointment of Ernst & Young LLP as the independent registered public accounting firm for 2025. These decisions reflect continued support for the company’s leadership and financial management, potentially impacting its strategic direction and stakeholder confidence.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 19, 2025