Greenbrier Cos. fell the most in almost seven months after Stifel Financial Corp. analysts estimated that railcar demand will be hurt by a decline in oil prices.
Stifel estimated production will be 84,000 railcars this year, less than transportation consultant FTR Associates’s outlook of 86,000. Decreased demand for cars that carry oil and coal will more than offset sales of other units, according to Michael Baudendistel, a Stifel analyst.
“The company’s shares are approaching our fair value estimate, considering 2015 may be the peak year for production,” said Baudendistel, who cut his rating on the stock to hold from buy.
Railroad companies -- Greenbrier’s customers -- are struggling with a widening fallout from the global rout in crude prices, which is eroding oil-train shipments faster than forecast. Utilities are switching from coal to natural gas, which is now lower priced and burns cleaner, hurting demand for coal cars.
Greenbrier, based in Lake Oswego, Oregon, fell 10 percent to close at $53.47 in New York, its biggest one-day drop since Dec. 1. The decline wiped out an 11 percent that the stock had posted this year through Monday, leaving the stock down 0.5 percent for the period.
Stifel raised the rating on FreightCar America Inc. to buy from hold, saying that the railcar maker’s diversification strategy should help it overcome the lower demand for coal carriers. FreightCar rose 8.6 percent to $23.86, its biggest jump since August 2014.