A Rail Stock for the Long Haul

A mild recession could be a good thing for Kansas City Southern's shares -- it could make them a better deal.

Even though they may be platitudinous, analogies are sometimes hard to resist. On February 5, Kansas City Southern reported fourth-quarter earnings that blew past what Wall Street analysts had been expecting. On a day during which the Dow Jones industrial average fell 370 points, and despite an analyst's downgrade of KCS's railroad-industry competitors, shares in Kansas City Southern gained nearly 2%. Look at that performance as kind of like, well, a locomotive hauling heavy cargo up a slippery mountainside.

The stock gave up those gains and then some on February 6, falling 2.7% as the broader market waffled.

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Anne Kates Smith
Executive Editor, Kiplinger's Personal Finance

Anne Kates Smith brings Wall Street to Main Street, with decades of experience covering investments and personal finance for real people trying to navigate fast-changing markets, preserve financial security or plan for the future. She oversees the magazine's investing coverage,  authors Kiplinger’s biannual stock-market outlooks and writes the "Your Mind and Your Money" column, a take on behavioral finance and how investors can get out of their own way. Smith began her journalism career as a writer and columnist for USA Today. Prior to joining Kiplinger, she was a senior editor at U.S. News & World Report and a contributing columnist for TheStreet. Smith is a graduate of St. John's College in Annapolis, Md., the third-oldest college in America.