If you held on to your Union Pacific Corporation (UNP) shares, first discussed here on March 27, 2009, at a price of $43, during its summer doldrums, you're being rewarded, as the shares have powered ahead, taking out $80 and $90 resistance.

In fact, if you bought at/near the $48.62 price, now may be a good time to consider taking some profits off the table with UNP. However, those investors who can tolerate the risk can retain their full position and go for a possible greater gain.

I'd also raise the sell/stop loss to $76 from $43.

Railway company CSX (CSX) shares are up for the year. Even though the chart may look choppy, the stock is up nearly 35% year-to-date. Tuesday, it closed at a price of $57.26. After the bell, the company, which competes with such companies as Norfolk Southern (NSC) and Union Pacific (UNP), released third-quarter earnings were, and investors thought enough of them to give the company a bid in the extended session.

According to theflyonthewall, earnings per share of $1.08 beat the market's estimate by four pennies. That $1.08 figure was, as the corporate press release states, 48% higher than the year-ago income level.

CSX Corporation (CSX) isn't partaking in this afternoon's bullish sentiment on Wall Street. It's too bad, because the railways latest earnings report would seem to be the type that would spur some buying. The market can fool you, though;that's why it's hard to be a trader, especially in such volatile times.

The selling I'm seeing feels more severe than is necessary, but you have to wonder what others are expecting from the company in the near-term future. Perhaps those on the bearish side of the aisle know something we don't, as they say. Still, if we are eventually to come out of this rough time (which we will), than buying on dips can be a useful strategy, even if it involves suffering through a period of pain.

Rare is the day you should ignore a railway. CSX Corporation (CSX), which I first wrote about on May 1, 2009, at a price of $30.56, fits that bill. Here's why:

Look for CSX's revenue to increase 8% to 10% in 2010. Volumes should rise 3% to 4%, and overall prices for transport services should firm, albeit with some softness in selected price categories, as the U.S./global economic recoveries gain momentum in the second half of the year.

Basic materials transport, including coal and scrap, should also experience healthy business gains in 2010, and the company's increased efficiency adds to the positive story.

It is a sign of the times: cash-strapped states and other local jurisdictions are paring-back programs, in an effort to close budget deficits.

And amid this protracted revenue downturn, programs previously thought to be immune or insulated from cuts -- such as mass transit commuter rail, subway, and bus services -- are finding that their once exempt status no longer applies.

Now that Warren Buffett likes the railroads, maybe you should consider shares in one, too, and that's one reason I'm reiterating my Buy rating for eastern U.S. railroad CSX Corporation (CSX), first recommended on May 1, 2009 at a price of $30.56. If you bought CSX in May, you're up about 56%.

Since the May Buy rating, institutional investors (IIs) have been incrementally adding to their CSX positions, on the company's likely 5-7% increase in revenue for FY2010. Volumes should increase and overall prices should firm, albeit with some softness in selected price categories.

Warren Buffett's (NYSE: BRK.A) decision to buy the 77.4% shares of Burlington Northern Santa Fe (NYSE: BNI) that he did not already own, for $100 each in cash and stock, is like an early holiday present for BNI shareholders.

And first recommended on April 30, 2009 at a price of $67.81, that means BNI shareholders will earn a cool 47% for their April-bought shares. Not bad for a six-month investment. I would say BNI probably was worth 10-15% more, but BNI shareholders will take the immediate pay-off, just the same.

Buffett's move also reflects his stance toward U.S. railroads, a sector I like, too.

This post is part of a series on some of the most memorable companies that have disappeared.

Although the name Lionel, synonymous with electric model trains, is still the hallmark of that toy genre, the current Lionel LLC, is in no way directly connected to the original Lionel Corporation.

The root stock of Lionel trains, Lionel Corp., was founded in 1900 by Joshua Lionel Cowen and Harry C. Grant in New York City. However, that company did not originally set out to manufacture toy trains. At the outset, Lionel was in the business of manufacturing small electrical devices, including fans and light fixtures. Lionel's first model train was in fact a window display designed to attract customers to other Lionel products. The train display was an immediate hit with customers, who then wanted similar sets for themselves, and thus the toy train business was set in motion.

Lionel had a bumpy yet upward ride from the time of its incorporation until 1957. In that year, a convergence of factors quickly brought trouble upon the company. A shift in consumer preference from Lionel's classic "O" gauge trains to the smaller "HO" scale cut deep into Lionel's sales. Toy buyers also began taking greater interest in the automobile, which compounded the company's troublesome decline. Then began a series of critical yet unsuccessful business moves that finally drove the company to bankruptcy in 1967. In 1969, Lionel acquiesced to the reality of its financial troubles and its toy train legacy was sold in its entirety to General Mills (NYSE: GIS).

It's a simple riddle and the answer is simple also. You'll probably kick yourself if you didn't think of it.

Riddle: Why would Warren Buffett want to play with trains?

Answer: Because he sees money in them.

Burlington Northern & Santa Fe (NYSE: BNI), Union Pacific Railroad (NYSE: UNP)

I'll keep this short and sweet because I just got off a twelve-hour shift and I have about six hours to sleep before I get back up and start all over again. Don't pity me, those are just the facts. If I don't average 50 hours a week, the credit union will come and swipe the Chevy truck off of my driveway!

Here are some of the things that I think Warren Buffett likes about the trains:

1.) Railroads are currently in a mildly depressed state business wise yet they are presenting very strong projections for the mid to long term.

2.) I believe that the American Railroad Association and members of the current Congress have a mutually held belief that railroads may expect to be well treated by government through the next presidential administration.

3.) Continuing upward pressure of fuel costs make rail transport increasingly more competitive with the trucking fleet and shall prompt more wholesale purchasing within our own continent.

4.) The rail industry has recently reported its safest year in history and it may expect reduced liability costs both within its own workforce and involving contact with the public sector.

I like trains also. As proof of that you may check out my past blog posts regarding them. While it is true that I didn't come right out and tell you to invest in the railroads, I did hope that you'd look into them.

Association of American Railroads welcomes the 110th Congress

Burlington Northern explores some explosive options for avalance control

The economy is firm but changing: Listen to the railroads.

As a supporter of wildlife and national parks, I am writing to express concern about Burlington Northern Santa Fe Corporation's (NYSE: BNI) alleged plan to use military artillery and other explosives for avalanche control in the southern boundary of Glacier National Park.

As you may be aware, Glacier National Park is a very special place for wildlife, providing habitat for a population of fascinating and valuable animals including the grizzly bear, gray wolf, Canada lynx and wolverine. All of these species occur in the southern portion of the Park being considered for shelling by Burlington Northern. I am very concerned that the possible use of explosives for avalanche control could have a measurable impact on the wildlife in the park.

According to local newspaper reports, there have been town meetings regarding this very issue, and several alternative plans are also on the table. Burlington Northern could invest in less destructive and more long-term solutions including repairing and expanding the network of snow sheds along the sections of avalanche-prone track. This choice would provide a more permanent and safer solution for the park's wildlife and visitors.

I would be horrified if Burlington Northern was serious about its proposal to blast one of our most treasured places. There must be solutions which would be far less dangerous and disturbing to the wildlife that lives there. If BNSF is considering this option, we owe it to ourselves and to the animals to be fully aware of the possible impact.

Image: http://www.flickr.com/photos/jessicafm/

On November 9, 2006, Edward R. Hamberger, President and CEO of the Association of American Railroads (AAR) issued a statement of congratulations and welcome to the 110th Congress. CEO Hamberger stated in part, "We have worked well with the Congressional leadership of both parties in the past and look forward to continuing that relationship in the future. Addressing the enormous logistical challenges the nation faces will require a united and concerted effort by Congress, the Administration, the rail industry, its customers and employees."

The demands for freight movement and logistical support are predicted to triple over the next decade. This could mean that If we don't add logistical capacity soon, we could very well be faced with a freight movement capacity shortage that has the potential to intermittently cripple our national economy.

The AAR President confirmed, "The nation's freight carriers are committed to continuing to do their part to expand rail capacity. Over the past decade, the railroad industry has invested $64 billion in its infrastructure, a rate that far exceeds that of most other industries. In 2006 alone, the rail industry plans to invest a record $8.3 billion in track, locomotives and other capital equipment. Over the next six years, the railroad industry will create 80,000 of the best-paying jobs in the country; jobs that are located here in America; jobs that will stay in America. We look forward to working with Congress to build and expand the American economy through freight rail transportation."

The fact is that freight railroads today are moving record amounts of cargo and posting unsurpassed safety numbers while at the same time charging freight rates that are - on average - considerably less than they were in 1982.

If you'd like to get an amazing view of the number of American (and other) railroad operators, have a look at the huge list I've linked to. If you'd like to invest in a railroad this is a great place to get started!