Barclays cuts CSX to Hold on coal outlook, limited 2015 growth

|About: CSX Corporation (CSX)|By:, SA News Editor

CSX shares slipped a bit today after a Barclays downgrade, citing a lack of catalysts for the railroad and the firm's dim outlook for coal.

While the firm says CSX is still the cheapest in the sector, it sees marginal upside for the stock given a limited growth outlook in 2015 and notes that a difficult start to 2014 implies further headwinds, as CSX’s cost and margin performance has lagged peers in recent periods.

EPA regulations and soft exports drive Barclays' negative long-term view on coal, and coal represents an outsized profit to CSX relative to other businesses; the firm estimates a further 16% reduction in domestic coal for CSX through 2018.

In addition to cutting its CSX target price to $30 from $32, the firm lowers its target on Norfolk Southern (NSC) by $1 to $100.