10 Best Railroad Stocks To Buy Now

1. Union Pacific Corporation (NYSE:UNP)

Number of Hedge Fund Holders: 93

Union Pacific Corporation (NYSE:UNP) is a Nebraska-based provider of freight transportation services across the United States. The company transports agricultural products, coal, renewable fuels, construction materials, chemicals, metals, and automotive goods. On February 6, 2025, the company declared a quarterly dividend of $1.34 per share, set to be paid on March 31, to shareholders on record as of February 28. The company has been paying dividends for 126 years straight.

In the fourth quarter of 2024, Union Pacific Corporation (NYSE:UNP) posted a net income of $1.8 billion, up from $1.7 billion a year ago. Revenue came in at $6.1 billion, down 1%, mainly due to lower fuel surcharge revenue and a weaker business mix, though higher volume and core pricing gains helped offset some of the drop. On the bright side, revenue carloads were up 5%, and the operating ratio improved by 220 basis points to 58.7%. Overall, operating income rose 5% to $2.5 billion. UNP ranks 1st on our list of the best railroad stocks to buy.

According to Insider Monkey’s fourth quarter database, 93 hedge funds were long Union Pacific Corporation (NYSE:UNP), compared to 78 funds in the prior quarter. Arrowstreet Capital was a prominent stakeholder of the company, with a position worth $558 million.

Overall, Union Pacific Corporation (NYSE:UNP) ranks first on our list of the best railroad stocks to buy. While we acknowledge the potential of UNP to grow, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than UNP but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.