Union Pacific Corp (NYSE:UNP)

Analyst Edward Wolfe said total volumes last week, the final week of the third quarter, were down just 1.7 percent year-over-year, compared with a 2.4 percent decline for the total quarter, and 2.7 percent so far this year.

Improvements in demand for coal, grain and chemical carloads remain steady, Wolfe said. But intermodal, which has remained a strong segment throughout the quarter, weakened along with automobiles, Wolfe said. Paper and lumber, impacted by the slowdown in residential construction, remained the weakest segment.

Union Pacific Corp. continued to post "solid growth" last week, Wolfe said, while rival Burlington Northern Santa Fe Corp.'s demand remained weak for the quarter.

Union Pacific reported a 3.2 percent year-over-year improvement in overall demand last week, carried by strong coal and grain segments. Burlington Northern's volumes fell 3.6 percent last week, dragged down by suffering intermodal demand, the analyst said.

But Canadian Pacific Railway Ltd. continued to lead the pack with a 4.6 percent increase in weekly demand compared with last year. Demand at counterpart Canadian National Railway Co. slipped 3.1 percent.

Wolfe rates the sector "Market Weight."

In afternoon trading, shares of CSX Corp. rose $1.25, or 3 percent, to $43.32 and Union Pacific Corp. rose $4.67, or 4.2 percent, to $117.03. Norfolk Southern Corp. gained $1.26, or 2.5 percent, to $52.42, while Burlington Northern Santa Fe Corp. added $3.09, or 3.8 percent, to $85.08.

Canadian Pacific Railway Ltd. rose $1.63, or 2.3 percent, $71.61, and Canadian National Railway Co. added 7 cents to $55.36. Kansas City Southern gained $1.66, or 5.3 percent, to $33.13.

GOOD in short and long term

Buffett has his reasons.

I want to own this someday

Down almost 20% off its yearly high. A great stock to own forever.

when warren buffett speaks, listen.

Great double win play. Most efficient way to transport ethanol and more cost efficient to transport other goods.

125

Gotta love Uncle Peter's Rabbit Ranch. There is renewed intrest in Railroad's because they are much less expensive than trucking services. Coal boom and somebody has to haul all that corn.

Coal, cattle, grain, all needs to be transported by railcars. Industry is still a bit inefficent, but getting better every year due to demand.

"Uncle Pete" has always been about five quarters away from massive profitability--for the last five years! It still is a hell of an empire to run with not enough locomotives and too many of them outdated (another nickname "Under Powered"). Some absolutely wonderful routes that are choked with traffic ("Unlimited Parking"), keeping UNP from the kind of profitability the pundits proclaim. Me, I'd rather have BNSF (BNI) or either of the big Canadian systems, for the intermediate term at least.

growth

UNP is hot because the sector is hot, but UNP will have issues with operating ratio (net profit) on a go forward basis. Of all the big Class One RR's UNP is the worst in that ratio. In addition, UP is short of reliable locomotives and that will limit top line revenues.

Building up it's network of rail line for the vast fast pace globel economy. Adding track for double main lines for a more fluid running machine, infrastucture and new tech clean high power locomotive fleet.

Buffett.

If it's good enough for Buffett...

rails are proving more efficient than trucking in moving goods over long distance

great rail

Rail shipping has good earnings.