Greenbrier Companies Strongly Disagrees with Customs Ruling
Written by Emily J. Thompson, Senior Investment Analyst
Updated: May 21 2026
0mins
"The Greenbrier Companies strongly disagrees with U.S. Customs and Border Protection's determination on freight rail couplers issued on May 18, 2026 (EAPA Case 8183). The determination is disconnected from the real-world functioning of the North American interchange system for more than 80 years, where railcars routinely move between carriers and across borders under common carrier obligations. Railcars are not static goods entering the U.S. market-they are mobile transportation equipment that must circulate freely to support interstate and international commerce. This well-established practice underpins the seamless and efficient operation of the integrated North American rail network and the broader United States economy. By recharacterizing railcars and their component parts in a manner inconsistent with decades of agency practice and the corresponding legal framework, the determination risks disrupting efficient rail operations, increasing costs across the supply chain, and introducing barriers to trade within North America. These added regulatory burdens will immediately raise the cost of transporting a wide range of commodities-from energy and agriculture to consumer goods-leading to higher prices for American businesses and consumers. Greenbrier has always acted in accordance with long-standing transportation practices, applicable law, and guidance from relevant agencies. CBP's novel and untested determination departs from settled treatment of freight traffic and introduces significant uncertainty and costs for cross-border rail operations and the broader American supply chain. Greenbrier remains confident in our legal position. Greenbrier is carefully evaluating all available options, including seeking further administrative and judicial review. In doing so, Greenbrier advocates not only for its shareholders, customers, stakeholders, and employees, but also for the efficiency of the U.S. supply chain and growth of the broader American economy. Greenbrier will continue to cooperate with CBP and other agencies while we advocate to preserve the well-founded interpretation of the law that has been a cornerstone of an efficient U.S. supply chain and U.S. global competitiveness."
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Analyst Views on GBX
Wall Street analysts forecast GBX stock price to fall
3 Analyst Rating
1 Buy
0 Hold
2 Sell
Moderate Sell
Current: 47.230
Low
38.00
Averages
46.33
High
52.00
Current: 47.230
Low
38.00
Averages
46.33
High
52.00
About GBX
The Greenbrier Companies, Inc. is an international supplier of equipment and services to global freight transportation markets. The Company designs, builds and markets freight railcars in North America, Europe and Brazil. It is a provider of freight railcar wheel services, parts component parts, maintenance and sustainable conversion services in North America. It owns a lease fleet of approximately 16,800 railcars that originate primarily from its manufacturing operations. The Company offers railcar management, regulatory compliance services and leasing services to railroads and other railcar owners in North America. Its products include freight railcars, tank cars, intermodal railcars, automotive and sustainable conversions, and Component Parts. Its North American management services business offers a range of software and services that include railcar maintenance management, railcar accounting services, total fleet management, fleet logistics, administration and railcar re-marketing.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Three Profitable Companies to Avoid
- Greenbrier Concerns: Greenbrier (GBX) has a GAAP operating margin of 8.7%, yet declining unit sales over the past two years suggest it may need to invest in improvements to regain growth, while its low gross margin of 14.1% indicates fierce competition and high production costs, raising doubts about the long-term viability of its business model.
- MillerKnoll's Growth Issues: With a GAAP operating margin of 9.6%, MillerKnoll (MLKN) has only achieved 1.4% annual revenue growth over the last two years, significantly lagging behind peers, and its earnings per share have fallen by 7.9% annually over the past five years due to shareholder dilution, limiting its ability to invest or increase buybacks with a weak free cash flow margin of 2.4%.
- Encore Capital Group Risks: Encore Capital Group (ECPG) boasts a high GAAP operating margin of 36.8%, but its sales growth has been a modest 2.6% annually over the last five years, trailing the financial sector average, and its earnings per share have only grown by 3.7%, compounded by a high net-debt-to-EBITDA ratio of 5x that could necessitate unfavorable capital raising if market conditions worsen.
- Investment Caution Summary: While these companies are currently profitable, their growth potential and financial health raise significant concerns, prompting investors to carefully consider avoiding inclusion in their portfolios.
See More
Greenbrier Strongly Disagrees with Customs Determination on Rail Couplers
- Customs Dispute: Greenbrier strongly disagrees with the U.S. Customs and Border Protection's May 18, 2026 determination on freight rail couplers, asserting that it disconnects from the real-world functioning of the North American interchange system, potentially leading to uncertainty and increased costs in cross-border rail operations.
- Operational Impact Assessment: The determination risks disrupting efficient rail operations and increasing transportation costs, particularly for a wide range of commodities including energy, agriculture, and consumer goods, ultimately resulting in higher prices for American businesses and consumers.
- Legal Position Maintenance: Greenbrier is carefully evaluating all available options, including seeking further administrative and judicial review, to uphold its legal rights and ensure the efficiency of the U.S. supply chain.
- Commitment to Ongoing Cooperation: Greenbrier will continue to cooperate with Customs and other agencies while advocating for the preservation of long-standing legal interpretations that support the efficient operation of the U.S. supply chain and its global competitiveness.
See More
Greenbrier Strongly Disagrees with Customs Ruling on Rail Couplers
- Customs Ruling Dispute: Greenbrier strongly disagrees with the U.S. Customs and Border Protection's ruling on freight rail couplers issued on May 18, 2026, arguing that it disconnects from over 80 years of real-world North American interchange system operations, potentially raising transportation costs and impacting cross-border trade.
- Operational Impact Assessment: The ruling recharacterizes railcars and their components, risking disruption of efficient rail operations, increasing supply chain costs, and leading to higher transportation fees for a range of commodities, which could ultimately raise prices for American businesses and consumers.
- Firm Legal Position: Greenbrier is carefully evaluating all available options, including seeking further administrative and judicial review, to advocate for its shareholders, customers, and employees while ensuring the efficiency of the U.S. supply chain and economic growth.
- Ongoing Cooperation and Advocacy: Greenbrier will continue to cooperate with Customs and other agencies while advocating for the preservation of long-standing legal interpretations that support an efficient U.S. supply chain and global competitiveness.
See More
Cash Flow and Investment Value Analysis
- Greenbrier Performance Decline: Greenbrier (GBX) has a trailing 12-month free cash flow margin of 11.5%, but declining unit sales over the past two years may necessitate price cuts to stimulate growth, resulting in a low gross margin of 14.1%, raising concerns about sustainable long-term growth.
- Kodiak Gas Service Challenges: Kodiak Gas Services (KGS) has a free cash flow margin of 15.1%, yet its revenue base of $1.32 billion puts it at a disadvantage against larger competitors, with costs rising faster than revenue over the past five years, leading to a 3.7 percentage point decline in EBITDA margin and limited opportunities for reinvestment due to lack of free cash flow.
- Reddit Investment Opportunity: Reddit (RDDT) boasts a high free cash flow margin of 35.1%, with domestic daily active users growing at an average of 14.4% annually and average revenue per user increasing by 34.8%, indicating strong growth potential for reinvestment or capital return.
- Market Performance Comparison: While Greenbrier and Kodiak Gas face challenges, Reddit's stock price of $156.30 per share implies a valuation ratio of 18.7x, highlighting its competitive advantage and investment appeal in the market.
See More
Greenbrier Secures $425 Million Loan for Lease Fleet Expansion
- Increased Financing: Greenbrier Leasing Company announced a new $425 million long-term non-recourse loan with improved terms to support the ongoing expansion of its lease fleet, which is expected to significantly enhance the company's leasing revenue.
- Clear Loan Utilization: At closing, $300 million will be drawn, while $125 million in delayed draw commitments will be used to purchase railcars in the secondary market during fiscal 2026, thereby strengthening the company's asset base and market competitiveness.
- Strengthened Strategic Priority: CEO Lorie Tekorius emphasized that this debt replacement provides efficient long-term funding to support the expansion of the leasing platform, further driving growth in recurring revenue and generating tax-advantaged cash flows, showcasing the company's disciplined capital allocation.
- Banking Support Confidence: Greenbrier expressed gratitude for the continued support from banking partners, which not only reflects confidence in the company's strategy and business model but also lays a solid foundation for future business growth.
See More
Greenbrier Secures $425 Million Loan to Support Expansion
- Financing for Growth: Greenbrier Leasing Company has secured a $425 million long-term non-recourse loan, replacing an existing loan maturing in 2027 and extending the maturity to 2032, demonstrating the company's financial flexibility and strategic foresight.
- Clear Use of Funds: At closing, $300 million will be drawn, with plans to utilize $125 million of delayed draw commitments to purchase railcars in the secondary market during fiscal 2026, further enhancing the scale and competitiveness of its leasing fleet.
- Management Confidence: CEO Lorie Tekorius stated that this debt replacement provides efficient long-term funding to support the continued growth of the leasing platform, aiming to increase recurring revenue and tax-advantaged cash flows through disciplined capital allocation and leverage management.
- Strengthening Market Position: Greenbrier is a leading player in the design, manufacturing, and marketing of freight railcars in North America, Europe, and Brazil, owning a lease fleet of approximately 16,800 railcars, thereby solidifying its leadership in the global freight transportation market.
See More
Three Profitable Companies to Avoid
- Greenbrier Concerns: Greenbrier (GBX) has a GAAP operating margin of 8.7%, yet declining unit sales over the past two years suggest it may need to invest in improvements to regain growth, while its low gross margin of 14.1% indicates fierce competition and high production costs, raising doubts about the long-term viability of its business model.
- MillerKnoll's Growth Issues: With a GAAP operating margin of 9.6%, MillerKnoll (MLKN) has only achieved 1.4% annual revenue growth over the last two years, significantly lagging behind peers, and its earnings per share have fallen by 7.9% annually over the past five years due to shareholder dilution, limiting its ability to invest or increase buybacks with a weak free cash flow margin of 2.4%.
- Encore Capital Group Risks: Encore Capital Group (ECPG) boasts a high GAAP operating margin of 36.8%, but its sales growth has been a modest 2.6% annually over the last five years, trailing the financial sector average, and its earnings per share have only grown by 3.7%, compounded by a high net-debt-to-EBITDA ratio of 5x that could necessitate unfavorable capital raising if market conditions worsen.
- Investment Caution Summary: While these companies are currently profitable, their growth potential and financial health raise significant concerns, prompting investors to carefully consider avoiding inclusion in their portfolios.
See More
Greenbrier Strongly Disagrees with Customs Determination on Rail Couplers
- Customs Dispute: Greenbrier strongly disagrees with the U.S. Customs and Border Protection's May 18, 2026 determination on freight rail couplers, asserting that it disconnects from the real-world functioning of the North American interchange system, potentially leading to uncertainty and increased costs in cross-border rail operations.
- Operational Impact Assessment: The determination risks disrupting efficient rail operations and increasing transportation costs, particularly for a wide range of commodities including energy, agriculture, and consumer goods, ultimately resulting in higher prices for American businesses and consumers.
- Legal Position Maintenance: Greenbrier is carefully evaluating all available options, including seeking further administrative and judicial review, to uphold its legal rights and ensure the efficiency of the U.S. supply chain.
- Commitment to Ongoing Cooperation: Greenbrier will continue to cooperate with Customs and other agencies while advocating for the preservation of long-standing legal interpretations that support the efficient operation of the U.S. supply chain and its global competitiveness.
See More
Greenbrier Strongly Disagrees with Customs Ruling on Rail Couplers
- Customs Ruling Dispute: Greenbrier strongly disagrees with the U.S. Customs and Border Protection's ruling on freight rail couplers issued on May 18, 2026, arguing that it disconnects from over 80 years of real-world North American interchange system operations, potentially raising transportation costs and impacting cross-border trade.
- Operational Impact Assessment: The ruling recharacterizes railcars and their components, risking disruption of efficient rail operations, increasing supply chain costs, and leading to higher transportation fees for a range of commodities, which could ultimately raise prices for American businesses and consumers.
- Firm Legal Position: Greenbrier is carefully evaluating all available options, including seeking further administrative and judicial review, to advocate for its shareholders, customers, and employees while ensuring the efficiency of the U.S. supply chain and economic growth.
- Ongoing Cooperation and Advocacy: Greenbrier will continue to cooperate with Customs and other agencies while advocating for the preservation of long-standing legal interpretations that support an efficient U.S. supply chain and global competitiveness.
See More
Cash Flow and Investment Value Analysis
- Greenbrier Performance Decline: Greenbrier (GBX) has a trailing 12-month free cash flow margin of 11.5%, but declining unit sales over the past two years may necessitate price cuts to stimulate growth, resulting in a low gross margin of 14.1%, raising concerns about sustainable long-term growth.
- Kodiak Gas Service Challenges: Kodiak Gas Services (KGS) has a free cash flow margin of 15.1%, yet its revenue base of $1.32 billion puts it at a disadvantage against larger competitors, with costs rising faster than revenue over the past five years, leading to a 3.7 percentage point decline in EBITDA margin and limited opportunities for reinvestment due to lack of free cash flow.
- Reddit Investment Opportunity: Reddit (RDDT) boasts a high free cash flow margin of 35.1%, with domestic daily active users growing at an average of 14.4% annually and average revenue per user increasing by 34.8%, indicating strong growth potential for reinvestment or capital return.
- Market Performance Comparison: While Greenbrier and Kodiak Gas face challenges, Reddit's stock price of $156.30 per share implies a valuation ratio of 18.7x, highlighting its competitive advantage and investment appeal in the market.
See More
Greenbrier Secures $425 Million Loan for Lease Fleet Expansion
- Increased Financing: Greenbrier Leasing Company announced a new $425 million long-term non-recourse loan with improved terms to support the ongoing expansion of its lease fleet, which is expected to significantly enhance the company's leasing revenue.
- Clear Loan Utilization: At closing, $300 million will be drawn, while $125 million in delayed draw commitments will be used to purchase railcars in the secondary market during fiscal 2026, thereby strengthening the company's asset base and market competitiveness.
- Strengthened Strategic Priority: CEO Lorie Tekorius emphasized that this debt replacement provides efficient long-term funding to support the expansion of the leasing platform, further driving growth in recurring revenue and generating tax-advantaged cash flows, showcasing the company's disciplined capital allocation.
- Banking Support Confidence: Greenbrier expressed gratitude for the continued support from banking partners, which not only reflects confidence in the company's strategy and business model but also lays a solid foundation for future business growth.
See More
Greenbrier Secures $425 Million Loan to Support Expansion
- Financing for Growth: Greenbrier Leasing Company has secured a $425 million long-term non-recourse loan, replacing an existing loan maturing in 2027 and extending the maturity to 2032, demonstrating the company's financial flexibility and strategic foresight.
- Clear Use of Funds: At closing, $300 million will be drawn, with plans to utilize $125 million of delayed draw commitments to purchase railcars in the secondary market during fiscal 2026, further enhancing the scale and competitiveness of its leasing fleet.
- Management Confidence: CEO Lorie Tekorius stated that this debt replacement provides efficient long-term funding to support the continued growth of the leasing platform, aiming to increase recurring revenue and tax-advantaged cash flows through disciplined capital allocation and leverage management.
- Strengthening Market Position: Greenbrier is a leading player in the design, manufacturing, and marketing of freight railcars in North America, Europe, and Brazil, owning a lease fleet of approximately 16,800 railcars, thereby solidifying its leadership in the global freight transportation market.
See More
