Over the long haul, nobody can argue with Warren Buffett's masterful approach to value investing. In a volatile trading environment like this one, though, you just might be able to outperform him.
According to a recent filing, Buffet's Berkshire Hathaway
Mirroring strong results from competitor CSX
Burlington overcame a 7% decline in overall freight volume largely because a two-month lag exists between fuel prices and the fuel surcharges the company passes onto customers. This boost, then, is a result of the uncanny speed with which oil collapsed from more than $140 per barrel to near $40 during the second half of 2008. With limited downside remaining for oil, that train has left the station.
Furthermore, whereas competitors CSX and Norfolk Southern
Within a cauldron of unnerving economic indicators and a plague of reduced guidance for corporate earnings, Burlington's fourth-quarter and year-end results may look like a beacon through the fog. However, I believe the results foretell some significant obstacles ahead, and urge Fools to consider their moves carefully here. While I view quality rail carriers as excellent long-term investments, I am increasingly convinced that better entry points lie ahead for Burlington and other carriers.
More than 2,000 Motley Fool CAPS members, including 462 All-Stars, expect Burlington Northern Santa Fe to outperform the S&P 500. In all, the CAPS community has shared its collective insight on 35 "road and rail" companies. Join the free CAPS community today and share your views on how the rail industry will fare throughout the current financial crisis.
Fool contributor Christopher Barker thinks outgoing Merrill CEO John Thain should have to try living on the wrong side of the tracks. He can be found blogging actively and acting Foolishly within the CAPS community under the username TMFSinchiruna. He owns shares of Peabody Energy. Berkshire Hathaway is a Motley Fool Inside Value and a Motley Fool Stock Advisor pick. The Fool owns shares of Berkshire Hathaway. The Motley Fool's disclosure policy can climb any mountain.