Now that all the major North American railroads have reported 2010 earnings, it's time to break out our Foolish brushes and paint a portrait of this bellwether industry with broader, more fluid strokes. First, let's peek at results from the self-described "thoroughbred of transportation."
With attractive growth opportunities, including FedEx's
Aside from intermodal, Norfolk Southern sees coal shipments providing further strength in the new year. Export coal volumes actually tumbled 18% in the fourth quarter, and the company referenced winter storms and strong prior-year volumes as potential culprits. I had been searching for insight into Massey Energy's
Zooming out to the bigger picture, I observe some sequential softness in fourth-quarter freight activity that warrants mentioning alongside the strongly encouraging outlooks for the major railroad operators. Merchandise shipments for Norfolk Southern rose by 3% in the fourth quarter, substantially beneath the 14% pace of improvement logged for the full-year 2010. Corroborating data that first caught my attention in Union Pacific's
Also, while Norfolk Southern's fourth-quarter railway operating revenue grew by 14% year over year, this $2.4 billion figure remains 4% lower than in 2008's comparable quarter. I share in the industry's enthusiasm regarding the substantial strides made to date in rebuilding a foundation of normalized freight demand in the wake of the financial crisis, and I'm encouraged by their expectations for further gains in 2011. I'd merely suggest that Fools remain watchful for signs of diminishing growth rates across any of the key pillars of the domestic economy.