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1. Company Snapshot

1.a. Company Description

CSX Corporation, together with its subsidiaries, provides rail-based freight transportation services.The company offers rail services; and transportation of intermodal containers and trailers, as well as other transportation services, such as rail-to-truck transfers and bulk commodity operations.It transports chemicals, agricultural and food products, automotive, minerals, forest products, fertilizers, and metals and equipment; and coal, coke, and iron ore to electricity-generating power plants, steel manufacturers, and industrial plants, as well as exports coal to deep-water port facilities.


The company also offers intermodal transportation services through a network of approximately 30 terminals transporting manufactured consumer goods in containers; and drayage services, including the pickup and delivery of intermodal shipments.It serves the automotive industry with distribution centers and storage locations, as well as connects non-rail served customers through transferring products, such as plastics and ethanol from rail to trucks.The company operates approximately 19,500 route mile rail network, which serves various population centers in 23 states east of the Mississippi River, the District of Columbia, and the Canadian provinces of Ontario and Quebec, as well as owns and leases approximately 3,500 locomotives.


It also serves production and distribution facilities through track connections.CSX Corporation was incorporated in 1978 and is headquartered in Jacksonville, Florida.

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1.b. Last Insights on CSX

CSX Corporation's recent performance is driven by several positive factors. The company's operational recovery is complete, with clear signs of volume momentum and improved customer satisfaction. The Howard Street Tunnel expansion and industrial development are on track, unlocking capacity and supporting long-term market share gains. Additionally, CSX's infrastructure projects, stable cash flow, and effective cost controls position it for margin recovery and double-digit profit growth. A leadership transition with Steve Angel as new CEO and a strong shareholder yield, blending income, buybacks, and debt reduction, also contribute to the positive outlook.

1.c. Company Highlights

2. CSX Corporation's Q3 2025 Earnings: A Mixed Bag

CSX Corporation reported its Q3 2025 earnings, with operating income of $1.1 billion and earnings per share of $0.44, beating analyst estimates of $0.4241. Revenue was lower by about $30 million or 1% due to headwinds from unfavorable mix in coal pricing, despite a 1% volume growth. The company's coal revenue declined 11% for the quarter on 3% lower total volume, while intermodal revenue was up 4% with a 5% increase in volume. Adjusted expenses increased by 3%, driven by $35 million of restructuring, severance, and regulatory advisory expenses, and $25 million of network disruption costs.

Publication Date: Oct -17

📋 Highlights
  • Revenue Decline Despite Volume Growth: Revenue fell 1% ($30M) despite 1% volume growth, driven by unfavorable coal pricing mix.
  • Intermodal Growth Outpaces Merchandise: Intermodal revenue rose 4% with 5% volume growth, while merchandise revenue dropped 1% (-1% volume).
  • Adjusted Expenses Up 3%: Costs increased $35M from restructuring and $25M in network disruption expenses, impacting operating income to $1.1B.
  • Capital Expenditures and Shareholder Returns: Q3 CAPEX: $440M; YTD shareholder distributions: $2B, aligned with $2.5B annual CAPEX guidance.
  • 2026 Cost Efficiency Outlook: $100M cost benefit from non-repeating network disruption costs and $45M sequential Q4 benefits expected.

Segment Performance

The company's merchandise revenue and volume were down 1%, with revenue per unit (RPU) flat as core pricing gains were offset by lower fuel surcharge and unfavorable mix. Intermodal volume growth was a bright spot, with a 5% increase, while coal volume declined 3%. The company's CEO, Steve Angel, noted that the company is focused on safety, customer service, employee engagement, integrity, and ethics, and is working to be the best performing railroad in North America.

Operational Highlights

The company completed two major projects, the Howard Street Tunnel and Blue Ridge subdivision, which will position it for greater capacity and resiliency. CSX's capital expenditures were $440 million, and it spent over $2 billion on shareholder distributions year-to-date. The company expects to deliver volume growth for the full year and maintain its capital expenditure guidance of $2.5 billion.

Valuation and Growth Prospects

With a P/E Ratio of 23.51 and an EV/EBITDA of 12.51, the company's valuation appears reasonable. Analysts estimate next year's revenue growth at 4.3%. The company's focus on improving operating margins through price yield, volume growth, and continuous improvement is expected to drive best-in-class performance. CSX's ROIC of 9.88% and ROE of 23.31% indicate a strong ability to generate returns.

Outlook and Strategy

CSX's new CEO, Steve Angel, emphasized the importance of running the company to the best of its ability, creating value, and being prepared for strategic opportunities. The company is working to leverage its cost structure and improve margins through volume growth and operating leverage. With a strong network and improving cost momentum, CSX is well-positioned for growth, particularly in intermodal, and is working with customers to convert truck traffic to rail.

3. NewsRoom

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CSX Corporation (CSX) Presents at UBS Global Industrials and Transportation Conference Transcript

Dec -02

Source: seekingalpha.com

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CSX Chief Financial Officer and Chief Operating Officer to Address UBS Global Industrials and Transportation Conference

Nov -25

Source: globenewswire.com

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FIRST RESPONDERS CHILDREN'S FOUNDATION AND CSX BRING TOY EXPRESS TO 70 COMMUNITIES IN 12 STATES THIS HOLIDAY

Nov -24

Source: prnewswire.com

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2 Railroad Stocks to Watch From the Challenging Industry

Nov -24

Source: zacks.com

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Westgate Super Site Receives CSX Select Site Platinum Designation

Nov -12

Source: globenewswire.com

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CSX Corporation (CSX) Presents at Baird 55th Annual Global Industrial Conference Transcript

Nov -11

Source: seekingalpha.com

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TCW Relative Value Large Cap Fund Q3 2025 Buys And Sells

Nov -09

Source: seekingalpha.com

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CSX Corporation: Unlikely To See Strong Earnings Growth In The Near-Term

Oct -22

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.50%)

6. Segments

Rail

Expected Growth: 5.0%

The rail segment is expected to grow at a rate higher than the global hypothesis due to its dominant market position and the increasing demand for efficient and environmentally friendly transportation solutions. The growth is driven by the expansion of intermodal and coal traffic.

Trucking

Expected Growth: 4.0%

The trucking segment is expected to grow at a rate slightly lower than the global hypothesis due to the competitive nature of the industry and potential fluctuations in fuel prices and economic conditions. However, the segment's flexibility and ability to adapt to changing market conditions will support its growth.

Elimination of Intersegment

Expected Growth: 4.5%

As this segment is not a revenue-generating segment, its growth is not directly influenced by market conditions. The expected growth rate is assumed to be in line with the global hypothesis, as it is a mechanical elimination entry that follows the overall revenue growth trend of the company.

7. Detailed Products

Coal

CSX Corporation provides coal transportation services to various industries, including electric utilities, steel manufacturers, and industrial customers.

Intermodal

CSX offers intermodal transportation services, which involve the movement of goods in containers that can be easily transferred between ships, trains, and trucks.

Automotive

CSX provides rail transportation services to automotive manufacturers, transporting finished vehicles and auto parts.

Chemicals

CSX transports a wide range of chemicals, including hazardous materials, to various industries, such as manufacturing and energy production.

Agricultural and Food Products

CSX provides rail transportation services for agricultural and food products, including grains, soybeans, and ethanol.

Forest Products

CSX transports forest products, including lumber, paper, and wood pulp, to manufacturers and distributors.

Metals and Minerals

CSX provides rail transportation services for metals and minerals, including iron ore, coal, and steel.

Phosphates and Fertilizers

CSX transports phosphates and fertilizers to agricultural and industrial customers.

8. CSX Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

CSX Corporation operates in the railroad industry, which has a low threat of substitutes due to the high barriers to entry and the lack of alternative modes of transportation for bulk goods.

Bargaining Power Of Customers

CSX Corporation has a diverse customer base, including industrial, agricultural, and energy companies. While customers have some bargaining power, CSX's strong brand and extensive network limit their ability to negotiate prices.

Bargaining Power Of Suppliers

CSX Corporation has a strong bargaining position with its suppliers, including fuel providers and equipment manufacturers. The company's large scale and long-term contracts give it significant negotiating power.

Threat Of New Entrants

The railroad industry has high barriers to entry, including significant capital requirements and regulatory hurdles. This limits the threat of new entrants and allows CSX Corporation to maintain its market position.

Intensity Of Rivalry

The railroad industry is highly competitive, with several major players vying for market share. CSX Corporation faces intense competition from Norfolk Southern, Union Pacific, and other railroads, which can lead to pricing pressure and decreased market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 60.53%
Debt Cost 5.58%
Equity Weight 39.47%
Equity Cost 10.01%
WACC 7.33%
Leverage 153.37%

11. Quality Control: CSX Corporation passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
PACCAR

A-Score: 6.0/10

Value: 3.7

Growth: 6.7

Quality: 6.1

Yield: 8.0

Momentum: 3.0

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
Paychex

A-Score: 5.8/10

Value: 1.8

Growth: 5.8

Quality: 9.0

Yield: 6.0

Momentum: 3.0

Volatility: 9.3

1-Year Total Return ->

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Stock-Card
Norfolk Southern

A-Score: 5.6/10

Value: 2.7

Growth: 4.7

Quality: 5.7

Yield: 4.0

Momentum: 7.0

Volatility: 9.3

1-Year Total Return ->

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Stock-Card
Union Pacific

A-Score: 5.2/10

Value: 2.5

Growth: 4.8

Quality: 6.4

Yield: 4.0

Momentum: 4.0

Volatility: 9.7

1-Year Total Return ->

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Stock-Card
CSX

A-Score: 5.2/10

Value: 3.0

Growth: 5.8

Quality: 6.0

Yield: 2.0

Momentum: 5.0

Volatility: 9.3

1-Year Total Return ->

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Stock-Card
Wabtec

A-Score: 5.1/10

Value: 2.8

Growth: 6.7

Quality: 6.3

Yield: 0.0

Momentum: 6.0

Volatility: 8.7

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

36.3$

Current Price

36.3$

Potential

-0.00%

Expected Cash-Flows