Trinity Industries sees surging demand for rail cars

Shares of Dallas-based Trinity Industries gained the most in nearly three months after the company raised its annual profit forecast because of surging demand for rail cars.

Buyers are ordering more cars to haul cargo such as autos, chemicals, and farm and consumer goods, helping to make up for a dip in tanker sales brought on by falling oil prices, Senior Vice President Stephen Menzies said Friday.

The shift to new market segments as well as the “increased replacement needs for an aging fleet of general-purpose railroad cars supports our view of an extended rail car cycle,” Menzies said.

Trinity boosted its full-year profit projection late Thursday, saying earnings per share would be $4.45 to $4.75. That outpaced analysts’ average estimate of $4.43.

Second-quarter orders of 11,170 Trinity rail cars were “well above our expectations, representing nearly 56 percent of the industry orders and above what we view to be their historical/typical share of 33 percent,” said Allison Poliniak-Cusic, an analyst at Wells Fargo Securities.

Trinity is the biggest U.S. rail car maker and has facilities off U.S. 287 north of Saginaw and in Longview.

Shares of Trinity Industries (ticker: TRN) rose 5.2 percent to $27.34 on Friday, their biggest gain since May 1. The rally pared the year-to-date decline for the Dallas-based company to 2.4 percent.

Trinity officials have been tight-lipped about their Tarrant County operations, declining to respond to Star-Telegram inquiries about the plant.

In 2013, The Dallas Morning News reported that Trinity’s employment in Saginaw had doubled to about 450, and last year, the Longview News-Journal called Trinity the city’s largest industrial employer, with nearly 1,900 employees.

This report includes material from the Star-Telegram archives.

This story was originally published July 24, 2015 at 6:22 PM with the headline "Trinity Industries sees surging demand for rail cars."