CSX (NASDAQ:CSX) and Union Pacific (NYSE:UNP) are selections for the real-money Inflation-Protected Income Growth portfolio. In this brief video, portfolio manager Chuck Saletta offers three reasons he's holding on to both company's stocks despite their substantial rises since he bought those shares a little more than a year ago.

Summary:

  • Reasonable valuations, with market caps in line with fair-value estimates for both companies.
  • Healthy balance sheets, with debt-to-equity ratios around 0.9 for CSX and 0.5 for Union Pacific.
  • Covered and growing dividends with payout ratios in the low 30s and decent trends of dividend hikes.

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Chuck Saletta owns shares of CSX and Union Pacific. The Motley Fool owns shares of CSX. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.