The transportation sector is poised to have multiple, positive catalysts in 2024. Although the economy is slowing, the economic expansion will probably continue. Interest rates are poised to drop this year, which could simulate large purchases, such vehicles. Also importantly, travel trends remain quite strong. AND, many companies in the transportation sector will receive a significant amount of benefits from the government’s green tax credits and high infrastructure spending this year. For the investors who want to exploit these strong, on going trends, here are the three best transportation stocks to buy now.
Greenbrier (GBX)
A leading provider of equipment for trains, Greenbrier (NYSE:GBX) can benefit in two ways from government spending. Specifically, the company can benefit from increased demand for railcars for use in hauling materials, and the company may get a boost from Washington’s subsidies for rail safety measures.
It appears those scenarios are coming true, as the firm announced that it had received new railcar orders valued at nearly $710 million. This raised its rail car backlog to an impressive $3.8 billion. Moreover, GBX reported that maintenance services continued to experience positive momentum.
Overall, the firm’s top line climbed 5.5% versus the same period a year earlier to $809 million, while its earnings from operations came in at $65 million, versus a loss of $4.8 million in the same period a year earlier.
With GBX likely to continue benefiting from infrastructure spending and continued economic expansion, I remain upbeat on its outlook. Also noteworthy is that the shares have a very low forward price-earnings ratio of just 11.6 times.
Delta (DAL)
Defying predictions for a major slowdown in the travel sector, the International Air Transport Association predicted that the global operating profit of the airline sector would jump to $49.3 billion this year. This represents a surge of $8.6 billion versus last year’s figure. Of course, that prediction bodes very well for all large international carriers, including Delta (NYSE:DAL).
And last month, Delta reaffirmed its previous Q4 guidance for impressive increases of 9% to 12% in its revenue, along with a jump of 9% to 11% in its operating margin. And defying skeptics who say Airline stocks never go up much, DAL stock jumped about 30% between Oct. 27 and Jan. 5.
Despite the shares’ recent, large gains, they have a very low forward price-earnings ratio of just 5.9 times.
All of these qualities make DAL one of the best transportation stocks to buy.
Uber (UBER)
Like Delta, Uber (NYSE:UBER) is poised to benefit greatly from strong travel trends and the continued economic expansion. Additionally, the shares should continue to be boosted by the recent inclusion of UBER stock in the S&P 500.
Also likely to make investors excited about UBER stock is the fact that analysts, on average, expect the firm’s earnings per share to jump to $1.17 in 2024 from 38 cents this year.
Citigroup (NYSE:C) and investment bank Wedbush both named UBER stock as top picks last month. This shows that they’ve been in high demand over the past year. I think this demand is only going to increase making Uber one of the best transportation stocks to buy.
On the date of publication, Larry Ramer did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
