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The Buckle, Inc. (BKE), Union Pacific Corporation (UNP): A Nebraska Portfolio for Creating Wealth

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If you want to get rich, invest in Nebraska. Nebraska is home to five great publicly-traded companies. These companies have long histories of profitability and creating shareholder value.

Union Pacific Corporation (NYSE:UNP)

Living in Nebraska for 19 years, I gained a keen insight into its business, an understanding of its politics and a love for Big Red Football. With only 1.8 million people, Nebraska relies on ingenuity, hard work and efficiency to cover the needs of its people. Nebraska has the only unicameral legislature in the country, meaning bills must go through only one house, not two, before going to the governor for signature – a sign of efficiency.

Nebraska is a state of entrepreneurs. Several years ago, The Omaha World-Herald published an article showing at least 100 families in Omaha were worth $100 million or more. Some of them got rich investing with Warren Buffett, but many of them made their fortunes by starting businesses that grew into substantial enterprises, such as Peter Kiewit (construction) Willy Theisen (Godfather’s Pizza, Inc.) and Roy Dinsdale (banking and agriculture.)

The Nebraska portfolio

Based in Omaha, Berkshire Hathaway Inc. (NYSE:BRK.A)’s stock is up 24.77% year-to-date through June 30, up 34.31% over the past year and up 39.48% over the past five years. Buffett, the chairman and CEO, has said it will be difficult to achieve the 20% average annual returns that he has earned since he took over the company because the company is so large now. He aims to continue beating the S&P 500, however. Critics are worried about the company after Buffett dies, but advocates know that Buffett has spent much of the past 10 years preparing the company for his departure. Berkshire Hathaway Inc. (NYSE:BRK.A) owns over 80 great companies, including Burlington Northern Santa Fe Railroad.

The Buckle, Inc. (NYSE:BKE), based in Kearney, has seen its stock climb 16.53% year-to-date through June 30, up 31.46% over the past 12 months and up 70.63% over the past five years. The clothing retailer specializes in the sale of jeans, shirts and accessories in 443 stores, mostly in malls in the Midwest. The Buckle, Inc. (NYSE:BKE) has $144 million in cash and no debt and pays a 1.54% dividend. In addition, the company has paid a special dividend every year for the past five years in the fall. Last fall the special dividend was a 10% of the stock price.
Union Pacific Corporation (NYSE:UNP). has seen its stock climb 22.72% year-to-date through June 30, up 29.31% over the past 12 months and up 104.34% over the past five years. Based in Omaha, Union Pacific Corporation (NYSE:UNP) is the largest railroad in the United States.
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