# Novel?? idea for funding Amtrak? ...



## HARHBG (Oct 13, 2015)

I've not been a member of Amtrak Unlimited very long but have enjoyed reading many of the posts covering the vast number of subjects discussed. Quite an education.

Since Amtrak is a Private Corporation, albeit wholly owned by the US Government (of which makes each of us an owner, if only by default)...............yet 100% of the Stock for Amtrak is held by the US Government................

Why not take Amtrak public??? ............or make Amtrak an "Employee Owned Company"??? Or a combination of both?

Employee-owned could solve numerious "attitude" problems of "Toxic Amtrak Employees", perhaps instill a "Pride of Ownership" and sense of investment, and public stock would raise $$$ for much needed improvements.......and Stockholder Ownership would take it all out of the hands of Congressional meddling..................????

Just wishing America had a passenger rail system that worked and worked well and wasn't a system that is an embarrassment to the American Nation as a whole.

In all reality, if any Nation could afford to "do it right", it's the USA.


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## crabby_appleton1950 (Oct 13, 2015)

I like what you say and look forward to more input from those wiser than I am.


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## jis (Oct 13, 2015)

What do you suppose Amtrak stock would be valued at?


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## AmtrakBlue (Oct 13, 2015)

jis said:


> What do you suppose Amtrak stock would be valued at?


500 AGR points? :giggle:


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## haolerider (Oct 13, 2015)

jis said:


> What do you suppose Amtrak stock would be valued at?


If you look at freight railroads, their assets are more than the physical engines, cars,etc and include very valuable real estate in the way of trackage. Amtrak owned tracks are in a highly valuable location so they would have a high value. I,guess we need to ask Warren Buffett what he thinks Amtrak is worth! He certainly has experience in evaluating railroads. Amtrak's pension obligation may be high based on the number of employees reaching 30 years of service.


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## Paulus (Oct 14, 2015)

In 2000, Amtrak's common stock was worth approximately 3¢ per share, it's Federal owned preferred stock a total of $10 billion. Nowhere near enough to meet it's capital needs incidentally, though it's probably increased since then.


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## rrdude (Oct 14, 2015)

Who in their right mind would "invest" in Amtrak?

Show me how the corporation would pay dividends, or how the stock price would rise in price?

No, funding Amtrak, on a permanent, non-political basis, is the only way to have the potential for a great passenger rail system.

And their is not much consensus for that. Perhaps after Cali's HSR project matures, and shows promise, and by then Gen Xer's might begin to have, and utilize some political strength, but I'm still dubious.


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## jis (Oct 14, 2015)

Yeah, the problem is market cap depends on the ability to create returns on the investment, not on just having a bunch of assets. It is quite often the case where a very low earning potential outfit has market cap that is lower than its book value (the value of its assets), which then makes it a target for someone buying it off with a large debt financing and then taking it apart and selling off the assets to make money off of it. I suspect that is what will happen if you try to finance Amtrak through a stock offering, unless it is handled very carefully with a very small proportion of it offered in the market. I am dubious about the stock price being attractive enough to bring in much real money given the state of ROI of Amtrak at present.


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## rrdude (Oct 14, 2015)

jis said:


> Yeah, the problem is market cap depends on the ability to create returns on the investment, not on just having a bunch of assets. It is quite often the case where a very low earning potential outfit has market cap that is lower than its book value (the value of its assets), which then makes it a target for someone buying it off with a large debt financing and then taking it apart and selling off the assets to make money off of it. I suspect that is what will happen if you try to finance Amtrak through a stock offering, unless it is handled very carefully with a very small proportion of it offered in the market. I am dubious about the stock price being attractive enough to bring in much real money given the state of ROI of Amtrak at present.


Can you say Carl Icahn?


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## BCL (Nov 5, 2015)

Paulus said:


> In 2000, Amtrak's common stock was worth approximately 3¢ per share, it's Federal owned preferred stock a total of $10 billion. Nowhere near enough to meet it's capital needs incidentally, though it's probably increased since then.


I got curious and looked it up. The case basically died because they didn't file their suit in time. And it Lindner wasn't around for the decision.

http://www.railwayage.com/index.php/blogs/frank-n-wilner/fini-to-saga-of-amtraks-common-stock.html

http://www.law360.com/articles/624242/amtrak-share-valuation-suit-filed-too-late-judge-rules


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## NorthShore (Nov 6, 2015)

jis said:


> What do you suppose Amtrak stock would be valued at?


Ooo....let's play a fun game. Would a share trade at greater or lesser than my one share of X Train?


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