$98.60
0.07 (+0.07%)
Burlington Northern Santa Fe Corp (BNI)
CAPS Rating:
Through its subsidiaries, the Company is engaged primarily in the freight rail transportation business.
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I'm playing Monopoly in real life (kinda). As a young investor I'm buying 4 railroads and holding until i can buy other "properties". CSX NSC, BNI, and UNP basically hold a oligopoly on American Railways--making 80% of the total railway profit. Whereas the economy will temporarily hurt, railways are better positioned to weather the storm than trucking, which means when the market rises, railways will have even more business and more profit. (Disclaimer: A Long Term Play being made by a 22 year old)
There are multiple issues that affect rail profitability - derailments, injuries, EPA, fuel, infastructure, taxation, etc. One should also consider future issues - highway congestion, mass transit improvement, incentives to go "green," etc. Class I railroads are usually the one of the last to feel the effects of downturns in the economy, and one of the first to recover.I think Warren Buffett's interest in certain railroads is not just a place to park some cash or speculate with market timing. He invested heavily in railroads because he sees what's coming down the pike - he invests for the future. If you're not a day trader, but someone who invests for the long haul, railroads should probably be a part of your portfolio IMHO.