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Friday, June 19, 2009

Lets ride the rails With Norfolk Southern (NSC)

Sporting a current P/E of 9.01 and a decent 3.57% dividend. Payout ratio coming in at 29.39% meaning the dividend is pretty safe. My target is $48.57 currently trading at $38.34, making it a solid value play. I started buying/accumulating at $27.12 a share currently up 15% and will keep collecting shares, currently long, BNI, NSC, CSX, PRPX, and UNP in my railroad folio. Up 18.87% year to date in this folio.

Norfolk Southern Corp. is a Virginia based freight railroad company operating primarily in the eastern United States. NSC operates approximately 21,000 miles of railroad across 22 states comprising 2/3rds of the American population. NSC generated its 2008 operating revenues from the following traffic sources: Coal (28%), General Merchandise (52%), and Intermodal– (i.e. standardized containers that are handled and transferred between ships, trucks and rail) (19%).

NSC’s main competitor is CSX Corp but it also competes with other forms of freight shipping especially trucking.

Disclosure I am long all 5 Rail companies in my Railroad Folio. (Comtech Direct Inc.)

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