Union Pacific Corporation (UNP), CSX Corporation (CSX): Should You Ride These Rails or Wave Them Goodbye?

All aboard?

Trends in crude and intermodal as well as a housing recovery all bode well for the rails. With the energy efficiency of the railroads still better (and often faster) than trucks the light at the end of the tunnel is even brighter.

Tilson and Ackman will likely continue to ride Canadian Pacific Railway Limited (NYSE:CP). Despite the high P/E it may be the fastest growing. I think Buffett would pick Canadian National purely on its competitive advantages although he would probably also like hometown rail Union Pacific Corporation (NYSE:UNP). If you want yield you might pick CSX Corporation (NYSE:CSX), which seems to be picking up speed with analysts but CSX would be the least likely to outperform.

CNI Total Return Price data by YCharts

The article Should You Ride These Rails or Wave Them Goodbye? originally appeared on Fool.com.

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