Chasing Value: Watch BNI -- the heck with Citigroup

That's great, once again the horses got out of the barn and they want to close the doors. The funny thing about this is that closing the doors will keep the horses out alright, and the sell call might keep some investors out of this stock too, but everyone should do the opposite.

Given that the stock is trading at a discount to the average price that Warren Buffett paid when Berkshire Hathaway (NYSE: BRK.A) became the largest shareholder with a 22% stake, Burlington is very much worth watching. You do not need to buy it today; there is no rush. However, I would take advantage of any further negativity if it drops below $60 even with reduced earnings and a modest outlook.

Considering the shaky economy, a stock with a beta of 1.0 and a yield of 2.35% is not such a bad thing to hold, and with Berkshire the majority shareholder perhaps there will be less shenanigans with the books and balance sheet then we are seeing with some companies.

In February I posted Chasing Value: Has BNI become 'Berkshire' Northern Santa Fe and if you bought in at that time, you would have gone down with the market and up with the market and collected your dividend.

In this story I pointed out that I had sold "naked puts" in BNI with April strike prices of $55 and $60 getting paid to cover other peoples fears. They both expired and I got to keep the money but I also wrote that if the stock was put to me, meaning I had to buy them, I would have no problem owning BNI at an average price of $57.50 at a 35% discount to Berkshire.

One more thing; because industry's sometimes move in tandem I would also watch Norfolk Southern Corp. (NYSE: NSC) and Union Pacific Corporation (NYSE: UNP) in case the sector slides on bad news about BNI.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares of BRK.B.