This Omaha stock steams past Berkshire

As the markets hit all-time highs, an old-line railroad stock is one of the leading performers.

By TheStreet Staff May 15, 2013 1:25PM

thestreet logoRailroad Crossing with Train copyright Edmond Van Hoorick, Photodisc, Getty ImagesBy Bill Gunderson

 

Here we sit in the year 2013 and guess what? A railroad stock is one of the leading stocks in the entire market!


Union Pacific (UNP) is a $71.7 billion large-cap stock, whose company is headquartered in Omaha, Neb. It's also a stock I own in my conservative growth accounts.

 

Now you may be asking: Isn't this a stock of yesteryear, a stodgy old one? Yes, but it doesn't have the performance of the majority of stocks of yesteryear. It continues to retain its "Best Stocks Now"-like performance!

 

 



unp table1

During the past 10 years, UNP has delivered a 19.8% return each year to investors. The great Berkshire Hathaway (BRK.B), by contrast, has delivered 8.6% per year, during the same time!

 

unp table2

Over the past five years, UNP has delivered an average of 17.9% per year, while BRKB has dealt investors a 6.3% return.

 

Over the past three years, it's delivered almost 32% each year to shareholders as compared to BRKB's 13.5%.

 

Boring old UNP continues to chug along, delivering 20% to 30% per year. And in the last 12 months, UNP is up another 40.1%, earning it a momentum grade of "A-."

 

unp table3

 

Many people say that investing is all about the future. So let's take a look at UNP's valuation. While there are no guarantees that it will continue to perform well, whatsoever, UNP clearly has a proven track record (pardon the pun).

 

And looking to the future, we see that UNP is trading at just 14.1 times forward earnings. It is trading at a discount to the market, probably because it's not a very glamorous, "cool" stock. UNP is expected to grow by 14.2% per year over the next five years. It is trading at right around its growth rate, so it's not expensive, with a PEG ratio of 0.99.

 

 

unp graph

 

The final piece in analyzing UNP is to take a look at its stock chart, and here I see a stock that continues to hit new highs!

 

Out of the almost 3,400 stocks that I track on a daily basis, UNP is ranked number 84 overall and it earns an overall grade of "A."

 

And you thought that the only good thing in Omaha was the wizard himself!

unp table 4

 

 

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