Noble raises TP on railcar manufacturer FreightCar by about 19%, keeps 'outperform'

Noble Capital Markets has raised its target price for railroad freight car manufacturer FreightCar America by nearly 19%. The company now looks set to produce more railcars and higher-margin types than Noble had previously forecast. 

Noble values FreightCar America at $16 per share, it stated in a report released on Thursday (note: the report is publicly available after registration on channelchek.com). This is nearly 19% above Noble's previous target price and 40% higher than current quotes. At the close on Friday, July 25, one share cost $11.46. 

Noble has increased its railcar delivery estimates for 2028 through 2030 by 10-20%. In particular, Noble previously thought the company would operate four production lines, but now it assumes five being in operation from 2028. Thus, FreightCar America will not have to stop production of other products so as to produce new, higher-margin tank cars, as was previously expected. As a result, expectations for the company's earnings and cash flow from 2028 were upgraded. 

Noble maintained its "outperform" rating on the name. "We think [FreightCar America] intends to retain its hard-won market share," Noble concludes.

FreightCar America designs, manufactures, and sells railroad freight cars and related components. The company's latest earnings were for the 2025 first quarter. Although the top line declined 40% year over year to $96.3 million, profitability indicators improved. For instance, the gross margin was up 7.8 percentage points at 14.9% and net income came in at $50.4 million versus a net loss of $11.6 million for the 2024 first quarter. The company is focused on "delivering profitable growth," according to the earnings release.

For the full year, FreightCar America guides for revenue to be nearly flat year over year and adjusted EBITDA to grow about 7% to $43-49 million.  

Year to date, FreightCar America is up almost 28%. The stock has only two ratings from Wall Street analysts, both being "buys," according to MarketWatch. The average target price is $12.67 per share, implying upside of 10.6% versus current quotes.

The AI translation of this story was reviewed by a human editor.