The Greenbrier Companies delivered a resilient QQ4 2024 with a clear ladder of earnings improvement and a reinforced strategic posture. The quarter featured EBITDA of $159 million—the second highest quarterly figure in the period—plus a gross margin expansion to 18.2%, marking continued progress toward sustainable mid-teens gross margins. Management underscored a multiyear backlog of approximately $3.4 billion and a backlog of 26,700 railcars valued at roughly $3.4 billion, providing meaningful revenue visibility as the company benefits from the Better Together strategy that emphasizes manufacturing leadership, margin expansion, and the growth of recurring leasing revenues. In 2024 Greenbrier achieved aggregate gross margins of 15.8%, up 460 basis points versus 2023, and signaled a trajectory toward higher profitability in 2025 as operating efficiencies, insourcing, and lease fleet expansion bear fruit.
Management articulated an ambitious but disciplined framework for 2025: new railcar deliveries of 22,500 to 25,000 units, revenue between $3.35 billion and $3.65 billion, and an aggregate gross margin of 16.0% to 16.5% with operating margin between 9.2% and 9.7%. The guidance reflects continued benefits from improved product mix, stronger syndication activity, and the expected monetization of a growing, higher-margin leasing stream. The company remains confident in its ability to double recurring leasing revenue by fiscal 2028 from a base of around $113 million to $226 million (and beyond), aided by a target to invest up to $300 million net per year in the lease fleet and ongoing insourcing initiatives that bolster in-house fabrication and maintenance capabilities. This combination of backlog visibility, margin discipline, and capital allocation creates a favorable long-term trajectory, though the firm remains exposed to railcar cycle dynamics, steel input costs, and broader macro volatility.
Key takeaway for investors: Greenbrier’s QQ4 performance validates execution on its three-part Better Together strategy—manufacturing leadership, margin expansion, and doubling recurring leasing revenue—positioning the stock to benefit from a steady, more predictable revenue mix and a higher-quality earnings profile over the next few years, with meaningful upside if the leasing cycle remains constructive and international markets (Europe, Brazil) scale as anticipated.