Companies tied to the railway sector are expected to continue to push for public listings in the coming months and bankers say they expect a handful of IPOs. "There are definitely rail-related deals coming shortly," said one Street executive that works with industrial issuers. "All of the railroads are finally profitable, are generating cash and investing in capital equipment."
 
With capex surging for the sector, companies that produce industrial materials for rail cars or railroad ties are looking at potential offering. Last week, H&E Equipment Services, a concern that generates 30% of its revenues from the rail market, priced an initial offering at $18, a dollar above the high end of its anticipated range. The week before, American Railcar priced an IPO at $21, way above its $16-18 range, and traded as high as $31.99 before retreating to the $27 range mid-last week.
 
"There are rail plays owned by various types of owners—private equity and corporates alike," said the executive, adding profitability has improved thanks to the increased preference for rail transport over trucking amidst high oil prices.