Brian Rogers Union Pacific Corp UNP-N TOP PICK Apr 23, 2004

Been on a downtrend, though fairly priced. Earnings need to beat for shares to also rise. Trades at 18x forward PE and a PEG ratio of 1.7. A tailwind is US capex spending and all those materials that need transporting, like steel.

His concern is its 18x forward PE. A railroad stock can grow only so much more than GDP. Pricing power is limited. He needs to see earnings outperform.

Transports haven't seen a tailwind lately. Has the sector bottomed? The timing is tough for transports now.

He sold UNP to buy Wabtec, because the former services only one geography while Wabtec goes everywhere.

Operating income in Q4 +5% to $2.5 billion. Was held back by tariff talks; tariffs will hurt, but they have room to move with better volume and pricing. He targets $275.

Her choice in the space. Better cost management, strong network efficiencies, favourable long-term profit trend.

In process of buying a competitor and creating the first transcontinental railroad. A once-in-a-generation opportunity if they can get it right. Better opportunity than CNR for you to expand your portfolio beyond Canada.