NEW YORK (TheStreet) -- Transportation stocks have rolled over the
industrials over the past year, with the *Dow Jones Transportation
Average* returning 25% compared with the *DJIA's* 12% gain. And some
fund managers say that planes, trains and shippers will once again
lead the way in 2011.
"We are focusing on the transports because of the high barriers of
entry, sizable dividend yields and, in the case of the railroads, the
increasing costs of fuel, which is putting the trucking business at a
disadvantage when it comes to competing for low-cost shipping options
in North America," says Dan Neiman, manager at the *Neiman Large Cap
Value Fund*(NEIMX).
_TheStreet_ searched for 2011's titanic transport stocks with Neiman
and Eric Marshall, director of research for the *Hodges Small Cap
Fund*(HDPSX).
*Kirby Corp.*(KEX)
Houston-based Kirby operates inland tank barges and towing vessels
transporting petrochemicals, black-oil products, refined petroleum
products and agricultural chemicals throughout the United States'
inland waterway system. Kirby also owns and operates four ocean-going
barge and tug units transporting dry-bulk commodities. As the largest
inland barge operator in North America, Kirby controls roughly a third
of the market with most competitors consisting of much smaller, local
companies.
Back on dry land, Kirby also has a railroad element through its diesel
engine services segment. The company provides after-market service for
medium-speed and high-speed diesel train engines. Kirby's stock
performance has certainly has been stronger than a locomotive, up 30%
over the past year, and Hodges' Marshall expects more gains in 2011.
"Kirby has the critical mass in a capital-intensive business, which
gives them competitive advantages in dealing with large customers in
industries such as petrochemicals. Although they are limited to
waterways, barges are like the railroads in that they have a real
advantage to see utilization leverage in an improving economy due to
the fact that they offer the lowest-cost form of transportation," says
Marshall.
Source: Thestreet.com
