In the last few weeks, transportation stocks have been among the some of the industries witnessing frenzied buying. To give you an idea of the frenetic buying in the market, you don’t need to look beyond the volume being traded in Oshkosh Corporation (NYSE:OSK) stock price. If you need some more convincing news then just look at the new exchange traded funds (ETF) being launched, some way or the other those ETFs are related to transportation sector. I tried to pick four transportation stocks that retail investors could consider as decent plays.
Oshkosh Corporation (NYSE:OSK): graduating from small cap to mid cap
Oshkosh Corporation, a designer, manufacturer and marketer of a range of specialty vehicles and vehicle bodies, stock spent most of the past year in a long-term down-trend, making lower highs and lower lows below a declining 200-day moving average. Then, in early March 2009, OSK made a higher low and started trending back towards its 200-day moving average. In late April 2009, OSK crossed back above its 200-day moving average and after consolidating for close to a month, made a low of 9.25 right at the 200-day moving average and started trending higher. OSK closed June 2009 at $14.54 but suddenly jumped to $18.43 on July 1, 2009 that too at a record volume of 10,533,540. Buying was spurred by the Pentagon announced that the firm's new blast resistant, off-road ground force vehicles were the "clear winners" in a multi-billion dollar competition. Oshkosh won the bid to build 2,244 vehicles for a deal worth $1.06 billion. The company beat out defense industry heavyweights including BAE Systems (LSE:BA.L) and General Dynamics (NYSE:GD).
Currently, the stock is trading at $21.44, close to the 52 week high of $22.52 which indicates that still lot of steam is left in the stock. I am convinced that the stock will stay a long way from its 52 week low price of $3.85 for a very long time to come. Pentagon announced that the contract quantity could rise from 2,244 to 10,000. The Pentagon is expected to place a second order with Oshkosh valued at about $1.8 billion for 3,000 more vehicles by the end of July. Moreover, on the costs side the company has been moving aggressively to trim. Going forward, the stock has the potential to cross $30 by end 2009.
