GATX Story

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GATX -- USA Stock  

USD 81.26  2.23  2.67%

As many millenniums are excited about industrials space, it is only fair to break down GATX Corporation. We will evaluate why we are still confident in anticipation of a recovery. Is the firm current valuation justified? We will cover GATX valuation to give you a better outlook on taking a position in the stock.
Published over a month ago
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Is GATX outlook positive for November 2020?
The entity currently holds 5.46 B in liabilities with Debt to Equity (D/E) ratio of 2.91, implying GATX greatly relies on financing operations through barrowing. The firm has a current ratio of 3.07, suggesting that it is liquid enough and is able to pay its financial obligations when due. GATX has performance score of 6 on a scale of 0 to 100. The firm retains a Market Volatility (i.e. Beta) of 0.2836, which attests to not very significant fluctuations relative to the market. Let's try to break down what GATX's beta means in this case. As returns on the market increase, GATX returns are expected to increase less than the market. However, during the bear market, the loss on holding GATX will be expected to be smaller as well. Although it is extremely important to respect GATX current price history, it is better to be realistic regarding the information on equity current price movements. The way of determining future performance of any stock is to evaluate the business as a whole together with its past performance, including all available fundamental and technical indicators. By examining GATX technical indicators, you can today evaluate if the expected return of 0.16% will be sustainable into the future. GATX now retains a risk of 1.59%. Please check out GATX potential upside, as well as the relationship between the accumulation distribution and price action indicator to decide if GATX will be following its current trending patterns.
We determine the current worth of GATX Corporation using both absolute as well as relative valuation methodologies to arrive at its intrinsic value. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of GATX based exclusively on its fundamental and basic technical indicators. By analyzing GATX's financials, quarterly and monthly indicators, and related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of GATX's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of GATX. We calculate exposure to GATX's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to GATX's related companies.

GATX Investment Alerts

GATX investment alerts and warnings help investors to get more proficient at understanding not only critical technical and fundamental signals but also the significant portfolio-centered indicators. These indicators include beta, alpha, and other risk-related measures that will help you in monitoring GATX Corporation performance across your portfolios.Please check all investment alerts for GATX

GATX Valuation Ratios as Compared to Competition

Our valuation model uses many indicators to compare GATX value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across GATX competition to find correlations between indicators driving the intrinsic value of GATX.

How GATX utilizes its cash?

To perform a cash flow analysis of GATX, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash GATX is receiving and how much cash it distributes out in a given period. The GATX cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. GATX Net Cash Flow from Operations is fairly stable at the moment as compared to the past year. GATX reported Net Cash Flow from Operations of 462.6 Million in 2019

Exercise or conversion by Jeffery Young of 1033 shares of GATX subject to Rule 16b-3

Legal trades by GATX insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
GATX insider trading alert for exercise of 2019 nq stock option (right to buy) by Jeffery Young, SVP Chief Tax Officer, on 25th of November 2020. This event was filed by Gatx Corp with SEC on 2020-11-25. Statement of changes in beneficial ownership - SEC Form 4. Jeffery Young currently serves as vice president chief tax officer of GATX [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Breaking down GATX Indicators

GATX reported the previous year's revenue of 1.39 B. Net Income was 193.9 M with profit before overhead, payroll, taxes, and interest of 867.3 M.

Margins Breakdown

GATX profit margins show the degree to which it makes money. Margin indicators are used not only by investors but also by creditors or GATX itself as indicators of financial health and management effectiveness. Please look more closely at the different varieties of GATX profit margins.
Operating Margin20.32
EBITDA Margin0.59
Gross Margin0.62
Profit Margin0.17

GATX Earnings Before Interest Taxes and Depreciation Amortization EBITDA is fairly stable at the moment. Further, GATX Average Assets is increasing over the last 8 years.

GATX may start a relapse in November

Mean deviation is down to 1.25. It may suggest a possible volatility slide. GATX Corporation has relatively low volatility with skewness of -0.75 and kurtosis of 0.94. However, we advise all investors to independently investigate GATX Corporation to ensure all accessible information is consistent with the expectations about its upside potential and future expected returns.

Our Final Take On GATX

While some companies within the rental & leasing services industry are still a little expensive, even after the recent corrections, GATX may offer a potential longer-term growth to investors. With an impartial outlook on the current market volatility, it may be better to hold off any inventment activity and neither acquire nor exit any shares of GATX at this time. The GATX Corporation risk-reward trade off is not appealing enough to do any trading. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to GATX.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Ellen Johnson do not own shares of GATX Corporation. Please refer to our Terms of Use for any information regarding our disclosure principles.

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