Sunday, April 7, 2013

"Who will be the key players in the coming USA boom in LNG and the transport of it? Certainly the Union Pacific Railroad will be a key player."

Dow Jones Industrial Average 14,565.25   Week ending 04-05-2014


We have gone through the many booms in our country, of Railroads, Oil, Steel, Cotton, Personal Computers, .Dotcom Internet and the Smartphone boom. Now we are on our way to the new boom of LNG, that is, Liquefied Natural Gas, and its impact on the economy of our country in the use, sale and transport of this abundant energy source.

One company with a transport system already in place is
Union Pacific Corp. (Symbol UNP, $138.54) with their ownership of the Union Pacific Railroad.



UNP has a Return on Equity of 20.57 and a PEG Ratio of 1.00, (YCharts has the PEG at 0.7263), so somewhere in that range but definitely in the Freewilly BUY range.

In 2012, the company delivered revenues of $20.93 Billion, so this is definitely a substantial Large Cap company. The company is already doing well before the LNG boom with 2013 earnings projected at $9.40 per share and 2014 earnings projected at $10.76  per share.The PE on the stock I have seen listed at 16.75 with a forward PE of 14.69. 


Union Pacific has a tremendous rail footprint covering 23 States in the Mid-West and West.
It has connections with Canada and it connects with all 5 Major transport points going to Mexico and Latin America. The map of their coverage is shown to the right. Also, if my memory serves me correctly, some years back Union Pacific laid in beside their RR right of ways about a Gizillion miles of dark fiber for future communication transport. Not a bad idea by the grand railroad.

Back to financial stuff: the company pays a 2% dividend to add to your pockets and has a 5 year earnings growth rate of 16.45. 


The company, WITHOUT government assistance, invests millions of dollars into state transport infrastructures to maintain their critical rail routes providing much needed jobs and employment.


    So, how have the results been on your investment?  The UNP 12 month Total Return has been 27.51% and the 3 Year total return has been 88.65%. The stock chart looks great on this one.


So once again
, you have a chance to be a Railroad baron, like Cornelius Vanderbilt, (or Warren Buffett, for that matter,) and pick up 20 - 25 shares at a time of UNP and average in your purchases and position over time . (You can even buy 10 shares at a time.)

Have a Grand Sunday. Maybe have some fun and take a train ride today!

Freewilly

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