Monday, May 23, 2011

Kansas City Star


Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, railroad operator Kansas City Southern (NYSE: KSU ) has earned a respected four-star ranking.
With that in mind, let's take a closer look at Kansas City Southern's business and see what CAPS investors are saying about the stock right now.
Kansas City Southern facts
On CAPS, 97% of the 402 members who have rated Kansas City Southern believe the stock will outperform the S&P 500 going forward. These bulls include HardnoseDotCom andTradersinfo.
Late last month, HardnoseDotCom succinctly summed up the Kansas City Southern bull case: "[L]ow PEG, strong price uptrend."
Over the next five years, in fact, Kansas City Southern is expected to grow its bottom line at a brisk rate of 29% annually. That's much faster than other railroad operators like Canadian National Railway (NYSE: CNI ) (15%), Union Pacific(NYSE: UNP ) (14%), and CSX(NYSE: CSX ) (16%).
CAPS member Tradersinfo expands on KSU as a rather timely selection:
We see continued momentum at Kansas City Southern. Last quarter the Company reported revenue growth of 12% and a jump in operating income of 18%. This indicates that the railroad industry is growing along with the pickup in international trade. We are especially pleased with the way Management has kept costs under control in spite of fuel price hikes in Q1.
What do you think about Kansas City Southern, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Headquarters (Founded)Kansas City, Mo. (1962)
Market Cap$6.23 billion
IndustryRailroads
Trailing-12-Month Revenue$1.87 billion
ManagementCEO David Starling (since 2010)
CFO Michael Upchurch (since 2008)
Return on Equity (Average, Past 3 Years)6.6%
Cash/Debt$101.5 million / $1.6 billion

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