Watch List: Railroad Stocks

Railroad stocks are doing well today despite a recent downtrend. The industry is one of the few non-energy businesses that benefit from rising energy prices but the sector’s fortunes are closely tied to U.S. economic growth. Below, I’ve listed some stocks to add to our Watch List and some July/ August call options as well.

Burlington Northern Santa Fe (BNI, $97.93, up $3.30)
July 100 call (BNIGT, $1.30, up $0.50)
August 100 call (BNIHT, $4.00, up $1.35)

CSX (CSX, $59.50, up $2.62)
July 60 call (CSXGL, $2.05, up $0.90)
August 60 call (CSXHL, $3.60, up $1.30)

Canadian National Railway (CNI, $47.62, up $2.22)
July 50 call (CNIGJ, $0.40, up $0.25)
August 50 call (CNIHJ, $1.25, up $0.40)

Norfolk Southern (NSC, $61.18, up $2.32)
July 60 call (NSCGL, $2.30, up $1.30)
August 60 call (NSCHL, $3.50, up $1.20)

Union Pacific (UNP, $72.92, up $2.60)
July 70 call (UNPGO, $1.20, up $0.80)
August 60 call (UNPHO, $3.20, up $1.20)

After peaking in June, cargo shipments have declined cauing the sector to “sell-off” from their highs. The mid-west floods have also had a big impact on the industry and shipments are down. Still, these stocks have been in a long-term uptrend and the recent pause may offer some opportunities for us to get back in them.

Rick Rouse
Rick@OptionsMentoring.com

]]>

Leave a reply Cancel reply

CFTC Disclosure:

GOVERNMENT REGULATIONS REQUIRE DISCLOSURE OF THE FACT THAT WHILE THESE METHODS MAY HAVE WORKED IN THE PAST, PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE PERFORMANCE. WHILE THERE IS A POTENTIAL FOR PROFITS THERE IS ALSO A RISK OF LOSS. A LOSS INCURRED IN CONNECTION WITH Momentum Options Trading, LLC CAN BE SIGNIFICANT. YOU SHOULD THEREFORE CAREFULLY CONSIDER WHETHER TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CIRCUMSTANCE. THERE IS SUBSTANTIAL RISK IN TRADING. A LOSS INCURRED IN CONNECTION WITH FUTURES TRADING CAN BE SIGNIFICANT. WE MAKE NO CLAIM REGARDING PAST OR FUTURE PERFORMANCE. WE MERELY TRACK EVERY TRADE AND SHOW THE PERFORMANCE OF ALL TRADES THE SYSTEM OR NEWSLETTER PRODUCES. SIMULATED TRADING IS DIFFERENT THAN TRADING REAL MONEY. HYPOTHETICAL RESULTS ARE NOT REAL RESULTS. PLEASE CONTACT YOUR BROKER ABOUT THE RISK OR TRADING STOCKS, OPTIONS OR FUTURES. ALL COMMUNICATIONS ARE OPINIONS NOT ADVICE.

CFTC RULE 4.41 – HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.

Blog