UPDATE: KeyBanc Capital Markets Downgrades FreightCar America to Underweight

According to a research report published today, KeyBanc has downgraded FreightCar America

shares from Hold to Underweight, along with decreased FY12 estimates. KeyBanc commented in the report, “We expect RAIL is likely to monetize most of its roughly 8,300 car backlog (including about 3,300 rebuilds) in 2012. Additionally, as we look at its primary end market, coal cars, we think there will always be replacement volume for which the Company will be able to bid. That said, as we think about the potential that natural gas prices will remain extremely low for the foreseeable future in the context of increasing political headwinds around the mining and burning of coal, we think coal's share of domestic power generation could continue to shrink and that investments in new coal-related assets will be harder to justify. While we expect RAIL management will seek further diversification away from its primary end market, we see little to provide a meaningful catalyst in the near term. As such, we think RAIL's coal car volume and revenue in general is more likely to fall in 2013 than rise, meaning that in our view, consensus estimates for 2013 are far too optimistic." KeyBanc maintains its $19 PT on FreightCar America, which closed Friday at $26.15.