Two industrial stocks to watch as the market moves up - Kalkine Media

October 10, 2023 01:31 AM PDT | By Akanksha Vashisht
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Summary

  • The Dow Jones Industrial Average Index (DJIA) rose by around 0.6% and the S&P 500 industrials index closed 1.61% higher on Monday.
  • Greenbrier Companies Inc., a railroad freight car seller, has a P/E ratio of 23.11x and a dividend yield of 3.01% based on Monday’s closing price.
  • McGrath RentCorp, a rental company, has a dividend yield of 1.84% and a P/E ratio of 22.10x based on Monday’s closing price.

On Monday, October 9, 2023, the Nasdaq Composite Index rose 0.39% intraday and by around 28% on a YTD basis. Meanwhile, the S&P 500 index rose by 0.63% on Monday.

At the same time, the S&P 500 industrials index ended trade 1.61% higher on Monday, beating the Nasdaq Composite index. The Dow Jones Industrial Average Index (DJIA) rose by around 0.6% on Monday.

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With that, let us explore two industrial sector stocks that saw positive stock price momentum on Monday.

Greenbrier Companies Inc. (NYSE: GBX)

Greenbrier specializes in creating and selling equipment for railroad freight cars in North America and Europe. Greenbrier derives most of its revenue from its manufacturing segment, and most of its revenue is generated in the United States.

For Q3 2023, Greenbrier reported revenue of US$1 billion, as against US$793.5 million in Q3 2022. Meanwhile, the gross margin for the quarter stood at US$128.1 million. The adjusted EBITDA was US$96.9 million in Q3 2023.

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Greenbrier’s net earnings were US$27 million, and the operating cash flow was US$98 million in Q3 2023. The company also repurchased 1.2 million shares of stock, worth US$32 million.

As at Monday’s closing price of US$39.91, GBX stock price rose 1.27% intraday and by 17.76% on YTD basis. Based on Monday’s closing price, GBX has a P/E ratio of 23.11x and a dividend yield of 3.01%.

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McGrath RentCorp (NASDAQ: MGRC)

McGrath RentCorp operates as a rental company with four distinct business segments. The main source of revenue for McGrath comes from leasing its equipment, and it also generates income through equipment sales.

McGrath reported a total revenue of US$203 million in Q2 2023, which marked a year-on-year increase of 32%. Meanwhile, the adjusted EBITDA was US$77 million, which was 33% higher as compared to the previous corresponding period.

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McGrath’s rental revenues increased 37% year-over-year to US$89.3 million. MGRC declared a cash dividend of US$0.465 per common share, to be paid on October 31, 2023.

Based on Monday’s closing price of US$101.28, MGRC has a dividend yield of 1.84% and a P/E ratio of 22.10x. As at the close of trade on Monday, MGRC stock price rose by 1.23% intraday and by 2.21% on a YTD basis.

 


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