MIAMI — Bear, Stearns & Co on Monday said it raised earnings forecasts for three North American railroads, saying shipping volumes were picking up faster than expected and should help profits, a wire service reported.
“With the exception of Eastern coal volumes, railroad carload volumes and intermodal units have shown a greater bounce back in Q2 than we had expected,” analyst Thomas Wadewitz said in a research note.
The analyst added 4 cents per share to his second-quarter forecast for Burlington Northern Santa Fe Corp., now at 50 cents a share. He also added 7 cents per share to his forecast for the other major western U.S. railroad, Union Pacific Corp., which he now sees posting share profits of $1.07 in the second quarter.
He also increased by 2 cents per share his forecast for Canadian National Railway Co., taking its estimate to 86 cents.
“We sense the greatest potential upside to current consensus Q2 EPS estimates for the western carriers (which) have benefited from a broad-based increase in commodity carloads and intermodal units and have been impacted less by weak coal and soft Canadian grain volumes,” the analyst said.
In morning New York Stock Exchange trading, Burlington Northern was up 19 cents to $29.69 a share, Union Pacific up 26 cents to $64.75 and Canadian National up 30 cents to $50.40.