As the economy continues to recover and supply-chain disruptions linger, demand for rail and freight services is increasing. Therefore, we think it could be wise to scoop up the shares of fundamentally sound railroad stocks CSX (CSX), Norfolk Southern (NSC), and Westinghouse Air Brake (WAB). Let’s discuss.The railroad industry suffered a significant setback amid the COVID-19 pandemic as travel restrictions were imposed. However, with a robust vaccination program and the economy’s gradual recovery, the industry is regaining some momentum. Continuing supply-chain disruptions are also fostering rising demand for rail and freight services. According to a trains.com report, the railroad industry is expected to reach $61 billion in new revenue by 2030.
The recently passed bi-partisan $1.2 trillion infrastructure bill includes $66 billion in freight and passenger rail investment, which should significantly boost the industry’s prospects. According to the Federal Railroad Administration, 28% of U.S. freight is moved around the country by rail, which is likely to increase substantially in the next couple of decades. In addition, the demand for battery-electric trains is also surging, owing to increased environmental concerns and cost savings.
So, we think it could be wise to add quality railroad stocks CSX Corporation (NASDAQ:CSX), Norfolk Southern Corporation (NYSE:NSC), and Westinghouse Air Brake Technologies Corporation (NYSE:WAB) to one’s portfolio now. They are expected to gain this month and beyond.