Monday, April 07, 2014

Take a Ride on Railroad Stocks


Warren Buffett, head of Berkshire Hathaway (BRK-A), owns a railroad, shouldn't you? A few years ago, Buffett bought Burlington Northern Santa Fe. Maybe it's time for investors to climb on the railroad ride.

 A recent article in Forbes pointed out that, according to the US Department of Energy, rail transportation is significantly more energy efficient that trucks and airfreight. So what railroads may go in the right direction? has turned up over a dozen stocks in the railroad industry, with more than ten paying dividends.

Norfolk Southern    (NSC), based in Virginia, operates in 22 states, and has been in business since 1883. The stocks trades at 16 times trailing earnings and 13 times forward earnings. Earnings for the year end quarter were up 24.2% on a 7.3% rise in revenues. The company will announce latest earnings on April 23. The yield on the stock is 2.2%.

Union Pacific    (UNP) is the largest railroad network in the United States. The stock trades at     20 times earnings and 15 times forward earnings. For the latest reported quarter, earnings were boosted up by 13.3% in a 7.2% increase in revenues. The stock sports a yield of 1.9%.

For a free list of all the stocks in the railroad industry, go

Disclosure: Author didn't own any of the above at the time the article was written.


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