The Obama administration has agreed to scale back requirements for new anticollision technology on freight trains, known as Positive Train Control (PTC). This stands to benefit companies such as CSX (CSX), Union Pacific (UNP), Norfolk Southern (NSE) and Berkshire Hathaway's (BRK.A) Burlington Northern Santa Fe.

PTC technology will automatically stop the train if a conductor misses its stop signal, coming in light of a 2008 train collision which killed 25 people.

This could possibly add 25% to CSX's free cash flow, which at these levels would make CSX and other rail companies undervalued by these metrics.

Jason is a co-founder of Benzinga.com.

Union Pacific (UNP) shares, first discussed here on March 27, 2009 at a price of $43, rose this winter to within roughly 50 cents of major, psychological resistance at $100, and if you haven't already, now may be a good time to consider taking some profits.

However, those investors who can tolerate the risk can maintain their full position, but keep in mind that the journey to $120 probably will not be completed in 2011.

Many macro-factors are running in UNP's favor. Union's revenue will likely increase an impressive 15-20% in 2010, with a better than 7% volume rise, on rising intermodal, industrial, and chemical transportation demand; 2011 revenue should advance 10-12%

Can you believe this? Railroad company Norfolk Southern has issued a 100-year bond with an interest rate of only 5.95%. In other words, you would be buying a 100-year bond without the slightest clue about will happen in the next 100 years in the railroad industry -- or in the world.

Nevertheless, Norfolk Southern (NSC) has raised $250 million in bond sales, more than double the $100-million minimum originally announced. Norfolk is believed to have gotten the lowest rate possible for its bonds.

Meanwhile, the 30-year U.S. treasury bond yields have dropped to their lowest level ever -- 3.65%.

Alcoa Inc. (AA) kicked off the earnings season Monday when it reported its first quarter results, and on Tuesday, after the market closes, rail carrier CSX Corp. (CSX) will get its chance to impress Wall Street when it reports its Q1 results.

Heading into today's report, analysts have forecast earnings of 69 cents per share. During the same period last year the company earned 62 cents.

If rail freight numbers are a good economic indicator, and in my experience they are, then the railroads are sending a very strong message right now. That message, in it's simplest form, says that our national economy is rebounding nicely from last year's low ebb, but we've not yet moved into what could be termed a substantial recovery.

The Association of American Railroads (AAR) latest traffic report paints a fairly bright, yet cautious, picture. Carload freight volume is above 2009 levels for the sixth straight week over last year, and intermodal freight volume (shipping containers and semi trailers loaded on train cars) is above 2009 levels for the twelfth straight week. Total freight volume for the week ending April 3, 2010 was estimated at 31.3 billion ton-miles. This represents an 11% increase over the same week in 2009, but still represents a decrease of 9.3% when compared to the same week in 2008.

A major acquisition is coming to light this morning, as Berkshire Hathaway (NYSE: BRK.A, BRK.B) has announced that it is acquiring Burlington Northern Santa Fe (NYSE: BNI). The deal calls for BRK to dish out $100 per share in cash and stock for the 77.4% of BNI shares that BRK doesn't already own. The deal will cost BRK $44 billion.

The acquisition gives us a glimpse into the mind of the Oracle of Omaha, BRK's CEO Warren Buffett. He feels that the "country's future prosperity depends on it having an efficient and well-maintained rail system." Buffett is betting that railroads are going to do well, which would stem from prosperity in the American economy.

Readers of this space know that one of the preferred sectors is the railroad sector. Time was -- just a short time ago -- the railroads were the darlings of Wall Street. Extraordinary demand for commodities from emerging markets and strong international trade increased demand for rail transport.

But then came the winds of September/October 2008: a financial crisis and the ensuing global recession stopped both commodity demand and trade nearly cold, and Wall Street soon soured on the railroads, including CSX Corporation (NYSE: CSX). In the panic and fear that occurred, the Street drove CSX's shares down to about $20 per share from over $70 in less than eight months. Talk about irrational behavior.

Not all values are within the U.S. Some values reside primarily outside the nation -- including Canadian Pacific Railway (NYSE: CP).

In general, analysts see F2009 carloads declining, netting a 0-5% revenue loss. That said, analysts also see an increase in potash shipments; meanwhile, the auto, intermodal, and coal export businesses will continue to struggle this year.

The rails -- once one of the chicest sectors in Wall Street circles -- were unceremoniously dumped by a financial crisis and an ensuing global recession that stopped both commodity demand and trade nearly cold.

Did Wall Street overdo it? Indeed they did, but the net result of that undiplomatic break-up is that certain railroads are offering bargains for investors who can tolerate moderate risk, and Norfolk Southern (NYSE: NSC) is one.

CSX (NYSE: CSX), a railway company whose colleagues include Burlington Northern Santa Fe (NYSE: BNI), Norfolk Southern Corp. (NYSE: NSC) and Union Pacific Corp. (NYSE: UNP), issued its Q1 report on Tuesday after the bell. As one might imagine, there was a drop in both sales and net income. The top line declined by 17%. The bottom line, on an adjusted basis (taking into account an item from last year's similar quarter), dropped 23% to $0.62 per share.

The economy is still taking its toll, obviously. Volumes were down during the quarter. However, the market sometimes cares about only one thing: beating expectations. CSX actually beat the analyst expectations of $0.51 per share. This significant difference led traders to push shares of CSX higher by 6.5% during Tuesday's after-hours session.

From the sound of selected analysts' research, you'd think that the U.S. economy would never recover. To be sure, there's much work ahead, particularly on the toxic asset removal and credit market fronts, but if you think the U.S. stock market's steady rise in March is a sign that financial institutions are starting to position themselves ahead of the typical investor, you're correct. And with the aforementioned in mind, Union Pacific (NYSE: UNP) is worth an evaluation.

Union Pacific is the leading rail freight carrier in the United States, transporting coal, chemicals, industrial products and freight over an enormous track network: 32,000 miles of route track in 23 states in the western U.S.

This post is part of a series featuring bargain stocks that are worth a look now. See more Cheap Stocks.

Maybe a railroad stock doesn't exactly seem like the cutting edge in investments. In fact, it might even strike you as old-timey. Fair enough -- but if you check out the year-to-date performance of Burlington Northern Santa Fe (NYSE: BNI), it's hard not to be impressed. At the end of November, the stock was down just 8% for 2008, compared to a loss of 40% for the broader S&P 500 Index (SPX).

The Texas-based freight firm transports everything from lumber and coal products to canned goods and oats. While you may have a perception of trains as pollution-spewing dinosaurs, BNI happily defies those stereotypes. Not only is the company adding new rail lines, it has also recently won accolades for its environmentally friendly practices. (Environmentally friendly for a railroad, of course -- I won't kid you by saying these locomotives run on rainbows and happy thoughts.)

On the fundamental front, BNI reported third-quarter earnings in late October that crushed analysts' expectations, and offered a rosy forecast for the fourth quarter. CEO Matt Rose said he's optimistic about his company's future, despite macroeconomic uncertainty. A pullback in corporate spending could actually benefit BNI, says Rose, because it's cheaper to transport goods by rail than by truck. "As the economy slows down, customers are going to be paying a lot more attention to cost," noted the chief executive.

Given the smorgasbord of economic demands and concerns -- domestic and foreign -- likely to face the new U.S. president, investors (and taxpayers) can justifiably ask 'Where's all the money going to come from to pay for these programs?'

Legitimate question, but one, for now, we'll let the political process sort out. (Current Gallup Daily Tracking Poll as of August 6, 2008, for the U.S. presidential election: Obama, 46%, McCain, 44%.)

Electing U.S. Sen. Barack Obama, D-Illinois, or U.S. Sen. John McCain, R-Arizona, will produce different programs and revenue priorities, due to the parties' different sources of power, but the argument forwarded here is that -- regardless of who becomes the new president -- the office holder should address transportation in a comprehensive way. Here are the major concern areas:

• Mass transit: We're early into the $4 gas era, of course, but initial U.S. Department of Transportation data indicates Americans are driving less and using mass transit more. The trouble is, many mass transit systems (rail, commuter rail, subway, bus) need to be expanded/upgraded to handle the increased ridership. Bigger, better mass transit systems will save the United States hundreds of billions of dollars in oil costs, not to mention the environmental benefits.

In a challenging market amid an uncertain U.S. economic landscape, identifying long-term, promising investment opportunities becomes a difficult task. Further, to make the investment equation even more challenging, there's election risk, as well, with the 2008 U.S. Presidential election five months away.

Still, risk-adjusted investment opportunities exist. Accordingly, here's a 'Fab Five' that should rank with the best the equity markets have to offer, 3-5 years out.

(Note: Don't buy these stocks if you're interested in a short-term trade of six months or less. These are longer-term investments where the goal is a double-digit, average, annual, total return on equity over 3-5 years.)

Potash (NYSE: POT). Current Price: $212, p/e 47. Revised Stop Loss: $170. Potash remains the best of a very good fertilizer bunch, due to its 20% global market share in the namesake fertilizer. Consider buying POT on a pull-back to $202-203, but keep in mind Potash may not retreat to that level.

Mosaic (NYSE: MOS). Current Price: $132, p/e 40. Revised Stop Loss: $97. Mosaic also is well-positioned in phosphate and crop nutrients. Further, the fact that 66% of its revenue is internationally based is especially appealing, given the U.S. economic slowdown.

Transocean (NYSE: RIG). Current Price: $144, p/e 10. Revised Stop Loss: $110. RIG offers deepwater oil drilling services in all regions of the world, and it's an oil-thirsty world.

Freeport-McMoRan (NYSE: FCX). Current Price: $114, p/e 14. Revised Stop Loss: $69. Copper / gold / molybdenum miner Freeport is one of a handful of companies that have the economies of scale to compete in the global mining sector of the early 21st century, and it boasts impressive clients, to boot. Consider buying FCX on a pull-back to $111-113, but keep in mind Freeport may not retreat to that level.

CSX Corp. (NYSE: CSX). Current Price: $66, p/e 23. Revised Stop Loss: $48. Ride the railroad resurgence with this superior trade / commodity / freight transport company. The rails are in the transportation sweet spot: truck transport costs are rising with fuel costs, and the U.S. highway system is inadequate, with increased congestion likely, pending future investment.

Top Pick: Potash.

Safest Pick: CSX Corp.

Disclosure: Lazzaro has no positions in stocks. In addition to private real estate holdings, he owns corporate and municipal bonds, and cash certificates of deposit.

Readers of this space know that one of the preferred sectors is the railroad sector. The once near-rust-belt level sector has experienced a revival at the start of the globalization age, and compelling economic trends document the commerce-based underpinnings of this revival.

Most transportation officials agree that the U.S. transportation infrastructure -- highways, roads, bridges, mass transit systems -- is in need of a major upgrade in order to meet the nation's vehicle transportation needs of the 21st century.

The nation's public officials will begin to address the above concern in the years ahead, as public funds become available, but until they do, and due to crude oil's sustained high price, an opportunity has emerged for another transportation form: you guessed it, the railroads. And Norfolk Southern (NYSE: NSC) is a railroad worth an evaluation.

Norfolk Southern provides rail transportation in the eastern United States, operating a 21,000-mile rail network in the eastern United States and Canada. It's an elaborate intermodal and coal service network that also has a large freight business.