CSX Corporation (CSX)

CSX is the railroad of the eastern United States: shorter hauls, denser population, a different freight mix.

Eastern railroads differ from western ones by geography: distances are shorter, competition with trucking is sharper, and the coal share has historically been higher. Coal declines structurally, and replacing it with intermodal and industrial freight is the company's multi-year task.

The barrier to entry is any railroad's: a parallel line cannot be built. Hence durable pricing and high margins. The efficiency metric is the operating ratio, which the industry spent a decade lowering through precision scheduling.

Risks are industrial production levels, diesel prices, union agreements and regulatory attention to shipper service quality: complaints about transit times have already led to hearings and orders. CSX pays a dividend and buys back stock consistently.