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What Are Analysts’ Recommendations for Major US Railroads?

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Analysts’ recommendations

Earlier in this series, we covered the dividend history and growth of major US railroads. In this part, we’ll compare Wall Street analysts’ consensus ratings for these railroads. The rating scale ranges from one to five. One means a “strong sell” and five means a “strong buy.” We’ll also see how many analysts rate each stock as “buy,” “sell,” and “hold.”

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Norfolk Southern 

Norfolk Southern (NSC) has a Wall Street analyst consensus rating of 3.48 or “hold.” Of the 27 analysts’ recommendations, seven gave it a “buy,” 20 gave it a “hold,” and no analysts gave it a “sell.” Norfolk Southern’s average 12-month price target is $90.9—compared to its market price of $88.8 on May 11, 2016. This implies a return of 2.8%.

CSX 

CSX (CSX) has a Wall Street analyst consensus rating of 4 or “buy.” Of the 28 analysts covering the stock, 16 analysts gave it a “buy” recommendation. CSX’s average 12-month price target is $27.65—compared to its price of $25.89 on May 11. This translates into a return of 6.8%.

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Canadian Pacific Railway 

Canadian Pacific Railway (CP) has a consensus rating of 4.37 or “buy.” Of the 27 analysts who gave recommendations, 19 gave it a “buy” and eight gave it a “hold.” None of the analysts gave it a “sell.” Canadian Pacific Railway’s average 12-month price target is $163.85—compared to its price of $137.6 on May 11. This implies a return of 19.1%.

Canadian National Railway 

Canadian National Railway (CNI) has a Wall Street analyst consensus rating of 4.4 or a “strong buy.” Of the 26 analysts who gave recommendations, six analysts gave it a “buy,” 20 gave it a “hold,” and no analysts gave it a “sell.” The stock’s average 12-month price target is $63.31—compared to its market price of $59.5 on May 11. This implies a return of 6.4%.

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Union Pacific 

Union Pacific (UNP) has a Wall Street analyst consensus rating of 4.36 or “buy.” Of the 28 analysts covering the stock, 20 analysts gave it a “buy.” Union Pacific’s average 12-month price target is $91.8—compared to its price of $84.49 on May 11. This translates into a return of 8.7%.

Kansas City Southern (KSU)

Kansas City Southern (KSU) has a Wall Street analyst consensus rating of 3.76 or “hold.” Of the 21 analysts tracking the stock, nine gave it a “buy,” 11 gave it a “hold,” and one gave it a “sell.” Kansas City Southern’s average 12-month price target is $99.33—compared to its market price of $91.7 on May 11, 2016. This implies a return of 8.2%.

Genesee & Wyoming 

Genesee & Wyoming (GWR) has a Wall Street analyst consensus rating of 4.2 or “buy.” Of the 15 analysts covering the stock, nine analysts gave it a “buy.” Genesee & Wyoming’s average 12-month price target is $69.8—compared to its price of $60.18 on May 11. This translates into a return of 16%.

The WisdomTree Earnings 500 Fund (EPS) is a growth ETF. The prominent transportation and logistics companies included in this ETF are Union Pacific, United Parcel Service (UPS), and Delta Air Lines (DAL).

In the next part, we’ll examine how these railroads are valued.

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