Source: thelope.com
Economic expansion since the Financial Crisis of 2008 has been stimulus-induced. Falling rail traffic implies the economy may have peaked. Combined U.S. rail traffic and intermodal units fell 4.4% Y/Y through the first 44 weeks of the year. That does not bode well for railroad operators like Kansas City Southern (KSU). The company reported Q3 revenue of $748 million, up 7% Y/Y. Revenue growth was driven by price hikes; carloads were flat, while average selling price ("ASP") rose 7% Y/Y.
Revenue was spurred by the Chemicals/Petroleum segment which rose 21% Y/Y