Wouldn't ya know it, just as I was preparing to turn bullish on the transportation sector, a bunch of Black Swans take flight. Just look at how fuel costs are driving up consumer prices. Transporters are passing on their fuel costs because they can't afford to eat them with margin compression anymore.
Kirby Corp. (KEX) has been doing very well this year but now thinks that Midwest flooding will have a greater than expected impact on its bottom line. I further suspect that the flooding will disrupt rail movements in affected areas. Willingness to buy into railroads right now is a bet that the imminent opening of spillways won't deluge any Class I tracks. Railroad bulk traffic has begun falling anyway, so buying rail stocks now might be premature until all of this news shakes out.
Silver lining? You betcha. These accidents of history will make the stocks I'm watching cheaper in the short term.
Full disclosure: No positions in KEX or railroad stocks at this time.
Kirby Corp. (KEX) has been doing very well this year but now thinks that Midwest flooding will have a greater than expected impact on its bottom line. I further suspect that the flooding will disrupt rail movements in affected areas. Willingness to buy into railroads right now is a bet that the imminent opening of spillways won't deluge any Class I tracks. Railroad bulk traffic has begun falling anyway, so buying rail stocks now might be premature until all of this news shakes out.
Silver lining? You betcha. These accidents of history will make the stocks I'm watching cheaper in the short term.
Full disclosure: No positions in KEX or railroad stocks at this time.
