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Why would this be a good time to invest in the railroad

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Reference no: EM131671225

Question - Investing Warren Buffet recently purchased Burlington Northern Railroad for 31% above its market value. The company has fixed costs of approximately 50 - 60%, and therefore huge operating leverage. Railroads have barriers to entry, are an energy-efficient method of transportation, and there are a limited number of railroads operating. Why would this be a good time to invest in the railroad?

Reference no: EM131671225

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