Railroad Week in Review:
Third Quarter 2007
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- Week in Review,
in Review published.
in Review, 7/13/2007
NS and Watco establish Joint Venture in Michigan. Pacific Harbor Lines
to acquire 16 fuel-efficient locos from WAB, partially funded by LA
and Long Beach. More ethanol opportunities for short lines. Using your
head and gut when selecting partners and acquisitions. B&P leases
36 miles in NY from NS. CSX to decentralize dispatching; reflections
on span of control.
in Review, 7/20/2007
STB notes "best practices" benefits of Fortress acquiring
FEC to complement RRA interests. CP rebuffs buy-out attempt for now;
rail and analyst communities generally against the idea. CSX and UP
open earnings week producing revenue, operating income and net income
gains in spite of declining revenue-unit counts.Amtrak performance on
UP and CSX still unacceptable indicating neither freight rail is operating
as well as they would have us believe. Chris Burger on "Span of
Control." RailTrends 2007 announcement.
in Review, 7/27/2007
roads reported this week. Revenues were generally up across the board,
though NS was off less than a point. CP was the strongest performer
with revenues up 7% and revenue units up 5.7%. CN took the OR honors
with a 60, acually up a quarter of a point. The chart following the
disclaimer provides some comps.
in Review, 8/3/2007
Why housings woes cascade through a much wider swath of commodities
than just the usual suspects. CSX steps up public image campaign. DME
sale momentum seems to have slowed. Genesee & Wyoming call not one
of their better presentations. Norfolk Southern rolls out the Roanoke
red carpet for more than 370 short line owners and operators.
in Review, 8/10/2007
ops on the Buffalo line as STB denies UTU request for a stay. I speak
with the GWR re transparency and learn a lot. Rick Paterson on Buffett's
BNSF buy; William Greene on transport outlook. CURE and others seek
a cure. Shareholder returns may be detrimental to your railroad's health.Walter
Rich passes away.
in Review, 8/17/2007
P&W net in 2Q07 increased 38% yoy as asset sales double, covering
52% slide in ops income on lower volumes. How the current liquidity
crunch can hurt handling-fee shortlines; why fixed-fee switching contracts
are particularly helpful in this environment. Ramifications of STB changing
cost-of-capital calculation. American RailCar posts record revenues
and gets beat up anyway. RMI RailConnect charts.
In Review, 8/24/2007
More ethanol plants open on short lines, P&W begins serving Motiva's
new Providence (RI) facility. NECR sees more light at the end of the
Bellows Falls tunnel. DM&E progress; Foster gives more color on
its 13% stake. UBS resets CP target price. Personnel comings and goings
on the LAL properties. STB sharpens its cost-of-capital pencil. Why
my PWX numbers differ from the 10-Q.
in Review, 8/31/2007
Highlights from UP's Annual Short Line Meeting. Implications of the
re-reg threat and why shortlines could be particularly at risk. Berkshire
Hathaway increases railroad stake in BNSF and possibly UP and NS. More
on Intrinsic value. Short line car counts lag the Class Is. Waco's Stillwater
Central embargoed due to flooding; reroutes in place.
in Review, 9/7/2007
Two long stories this week: The how and why behind CP's purchase of
the DM&E and some observations on the CSX Analyst Day on Thursday.
The CP deal is basically a straight railroad buy with an option to expand
into the PRB if conditions warrant. How FSTR shareholders doubled their
money in the bargain. CSX
talks about the state of the railroad business in general, the role
of CSX in particular and what it's doing to increase stakeholder value.
Lessons for short lines abound but you've got to listen to the call
to gain full measure of value.
in Review, 9/14/2007
A slew of Wall Street reports following the Sep 6 CSX investors meeting
in NYC. Further comment on the CP bid for the DME. Tom Murray's insights
on activist shareholders for railroads. Why trucks may be out after
still more of your carload business. UBS upgrades KCS to a Buy.
in Review, 9/21/2007
Warning: Being in the short line business may become hazardous to your
health if Congress and the STB have their way. See how EP 644, EP 646
and HR 2125 can turn the railroad clock back to the bad old pre-Staggers
days. The impact on short lines will be devastating.DME
redux: Why CP may have overpaid.