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Successful Business Transformation Initiatives Help Railroad Giant Strengthen its Position on Best Dividend Stocks List

Aaron Levitt Jun 26, 2019


When it comes to finding the best stocks, we often talk about moats. These competitive advantages and protective barriers against the competition can serve as a unique edge over rivals. An edge that drives profits, cash flows and sales far into the future. For our Best Dividend Stocks List pick in the transportation sector, its moat lies within the vast regulated monopoly.

Our firm owns one of the largest logistics networks of rail lines and terminals in the entire nation. As the economy has continued to improve, our pick has seen its star shine as more rail traffic has directly resulted in higher profits. Already, the firm has become a dividend champion in recent years and its buyback program has been expanded to well over $25 billion.

Meanwhile, recent trade deals with Mexico and Canada, as well as positive trade news with China, are likely to push profits and cash flows higher in the future.

The best part is that our transposition pick isn’t done yet.

In addition to expanding trade opportunities and a growing economy, our pick continues to invest in a heavy dose of tech to improve its efficiency, fuel economy and reduce costs further. This has only helped improve margins as evident from its standout first quarter of the year. Its powerful moat and initiatives managed to drive its EPS higher by more than 15%.

All in all, our transportation pick continues to chug along just perfectly and makes for an ideal selection for your portfolio.

To summarize, here are five reasons why you should own this stock:

  1. Complete monopoly of irreplaceable assets over the area in which it operates.
  2. A burgeoning dividend contender with roughly a decade’s worth of dividend increases, including a nearly 10% boost at the beginning of the year.
  3. Thanks to improvements to its operating model and new tech upgrades, EPS jumped by a whopping 15% during the first quarter of this year.
  4. Big winner from the Trump Administration’s trade deals with Mexico & Canada.
  5. Healthy payout ratio of 45% and growing yield of 2.08%.

Our Best Dividend Stocks List has 20 of the highest-rated stocks by our proprietary rating system. Go Premium to find out the entire list.

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