Any railroad mergers on the horizon?

Question

I'm wondering if you thing any rail mergers are in the future for North America??? What in general do you think of the future share price outlook in the next few months for the rails?? The rail/transport sector took a hit in the latter part of 2006.

Answer 1

Considering that there are only 6 major railroads left--2 in Canada, I somewhat doubt there will be any mergers on the near horizon. CSX is somewhat vulerable however. The rails indeed did take a hit but they have recovered much of the loss. The hit was due to the concern over the slowing of the economy. That concern is not without some merit.

Although I do not own any rail stocks, I do believe over the very long term 20+ years they are good investments. I doubt I will be around that long to see it. After all they are the only means of transportation that does not require hydrocarbons for locomotion. They can use electricity and even coal although I wonder if the art of building steam locomotives is lost forever. Maybe not a few of use still do know how to build one. Actually now with computerization I imagine the coal fired locomotives might be much more efficient than in the past and safer also. A steam turbine electric would really be a wonder. Wow! I sure would like to see that.

Answer 2

It is likely Big Oil Companies will start to buy Railroad Companies in the future to move Ethanol from A to B.