The firm also upped its price target to $99 from $94 on shares of the Kansas City, MO-based railroad company.
"KSU is beginning to deliver lower capital spending, higher margins and most importantly, the stock is now much closer to peer valuation levels, making us incrementally excited for the company's long-term prospects," Barclays wrote in a note earlier today.
The company's valuation premium has "dissipated" while management is driving some improvement, the firm added.
"We are not calling for a mega rally in the vertical, but rather marginal outperformance in rail stocks based on stabilization in volume this summer from better grain and coal combined with a likely bottom in energy spending," Barclays noted.
About 1.15 million of the company's shares traded today compared to its average volume of 972,952 shares per day.
Separately, TheStreet Ratings Team has a "Buy" rating with a score of B- on the stock.
The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins, good cash flow from operations, growth in earnings per share and largely solid financial position with reasonable debt levels by most measures.
The team believes its strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: KSU