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Genesee & Wyoming (GWR) Stock Gains 9% Yesterday: Here's Why

Zacks Equity Research

Shares of Genesee & Wyoming GWR gained 9% to $87.53 on Mar 11, following reports that the company is looking at various options including selling itself either entirely or partly. Reportedly, this Darien, CT-based railroad operator is in talks with various infrastructure-investment firms including Brookfield Asset Management on the matter. The talks are at an early stage.

Following an update on Genesee & Wyoming, share prices of most other sector participants including the likes of Kansas City Southern KSU, CSX Corporation CSX and Norfolk Southern Corporation NSC increased on Mar 11. As a result, the sector tracker — Dow Jones U.S. Railroads Index — appreciated 1.6% on the day.

Coming back to Genesee & Wyoming, shares of this Zacks Rank #3 (Hold) company have struggled lately. The stock has shed 0.5% of its value against the industry’s 1.1% growth in the past six months. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

Genesee & Wyoming has been facing several headwinds like high operating expenses and the below-par performances of its Australian and U.K./European operations. Therefore, the company might consider selling off its struggling operations and concentrate on its North American operations.

In 2018, the company's revenues from the North American unit increased 6.6% to $1.4 billion. Adjusted operating income from the business increased 10.7% in the same year.

Although no confirmation on Genesee & Wyoming’s intentions is yet available, we expect investor focus to remain on this railroad operator going forward.

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CSX Corporation (CSX) : Free Stock Analysis Report
 
Genesee & Wyoming, Inc. (GWR) : Free Stock Analysis Report
 
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Kansas City Southern (KSU) : Free Stock Analysis Report
 
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