Deutsche Bank: Expect Rails to Beat Expectations (UNP, CSX, NSC, RA)

Citing "volume growth and cost controls" Deutsche Bank reaffirmed its Buy rating on four railroad stocks this morning. Expecting positive operating leverage, Deutsche Bank sees strong upside to Q2 EPS estimates. Deutsche Bank maintains a Buy rating on Union Pacific UNP, CSX Corp. CSX, Norfolk Southern Corp. NSC and Rail America RA. Deutsche analysts remain upbeat based on "positive operating leverage amid solid volumes, improved network efficiency, and cost controls." Deutsche Bank sees "upside potential to Consensus Q2 2010 EPS estimates as we believe incremental margin estimates are likely too conservative."