Short-line railroad operator Genesee & Wyoming (NYSE:GWR) posted another period of solid results for its first quarter. Although the Australian segment of the business was a bit weaker than expected, the North American segment made up the difference.

North American revenue climbed 16.1% on a 9% increase in carloads and a nearly 6% increase in revenue per carload. On a same-rail basis, the company saw nearly 12% growth, with a 4.8% increase in traffic and a 7.5% increase in revenue per carload.

The usual suspects boosted the North American results. Coal revenue grew more than 14%, lumber improved 29%, and revenue from metals shipments grew 12%. Paper was also particularly strong in the quarter, with revenue up by nearly 23%.

Despite a nearly 38% rise in fuel costs, the company improved its operating ratio to 83%, and operating income climbed by more than 23% from the prior year.

Results from down under, though, were not quite as robust. Revenue climbed about 2.5% as improvements in iron ore, alumina, and other metals helped offset a decline in grain shipments.

The operating ratio worsened to 83.6% (from 78.6%) on the back of higher fuel prices, as well as two derailments on company tracks. Even though third-party operators caused the derailments, management attributes more than 2% of the operating-ratio drop to the costs of cleaning up the messes.

Management left forward guidance unchanged, though investors should note that consensus analyst expectations are actually pegged just a bit above management guidance. What's more, management guidance does not account for the risk that Burlington Northern (NYSE:BNI) might begin trying to institute fuel surcharges for the company.

More than a few readers have written me about my prior takes on Genesee & Wyoming; they've wanted to know why I don't own the stock if I like the company so much. The answer is pretty simple -- I'm a cheapskate.

Genesee & Wyoming is a great railroad, and it trades at a discount to its peers, but I'd rather buy it at a low-teens P/E than at a high-teens P/E. The difference between the two gives me a nice little margin of safety just in case traffic drops off or the company hits a bump or two in the road.

And so again, that's where I'll leave it today. I still think Genesee & Wyoming is a great railroad, but I don't own the shares, and I'm not likely to unless I can get them at a good discount. After all, buying great companies doesn't guarantee any sort of investment success -- buying great companies at great prices is what really does the trick over the long haul.

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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).