UPDATE: Stifel Upgrades FreightCar America (RAIL) to Buy, Cuts Greenbrier (GBX) to Hold

(Updated - June 16, 2015 1:53 PM EDT)

Stifel upgraded FreightCar America (NASDAQ: RAIL) from Hold to Buy with a price target of $29. Analyst Michael J. Baudendistel is positive on the stock's valuation and the company's strong cash position. If it gets its diversification strategy "half right," shares could more higher, he said.

Baudendistel also downgraded Greenbrier Cos. (NYSE: GBX) to Hold, as shares appear to be approaching fair value.

Baudendistel explained, "We are raising our rating on FreightCar America (RAIL; $21.97) from Hold to Buy on the basis of valuation with the company’s net cash balance representing 50% of the company’s current market cap and our view that the company’s shares should appreciate if it can get its railcar diversification strategy “half right” even with an expectation for continued weakness (or non-existence) in demand for new coal railcars. Our target price on RAIL is $29 (or 9.0x our 2017 EPS estimate of $2.00 plus $11 per share in normalized cash)."

On Greenbrier the analyst said, "We are reducing our rating on The Greenbrier Companies from Buy to Hold to reflect our view that the company’s shares are approaching our fair value estimate, considering 2015 may be the peak year for production. We believe the main risk to our downgrade is that the company’s margin improvement initiatives may deliver better results than we are modeling."

For an analyst ratings summary and ratings history on FreightCar America click here. For more ratings news on FreightCar America click here.

Shares of FreightCar America closed at $21.97 yesterday.

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