The railroad sector is looking like an attractive investment, said Jason Seidl, director of Dahlman Rose & Co.
“We’re very poor in infrastructure right now…We don’t even have maintenance capital in our road systems, so we need more rails going forward,” Seidl told CNBC.
Seidl said export coal and the intermodal volumes will help boost eastern railroads. He has "buy" or "hold" ratings on most rail stocks. Intermodal shipping involves shifting containers from one means of transport to another; for example, lifting a cargo container from a ship on the Pacific coast and dropping it onto a railcar in port for transport eastward.
“The "hold"[-rated stocks] right now have some appreciation in them and the "buys" that we’ve been pushing are the eastern railroads."
Scorecard—What He Said:
- Seidl's Previous Appearance on CNBC (Nov. 30, 2010)
More Market Intelligence:
- Beware of 'Double-Dip Scare' in Near-Term: Strategist
- Markets Are 'Overreacting' to Geopolitical Events: Economist
CNBC Data Pages:
Top Railroad Companies:
Union Pacific Corporation
Kansas City Southern
Seidl does not own shares of CNI, CP, CSX, GWR, KSU, NSC, RA, UNP.