Oct. 20, 2015, 12:15 PM
- CSX (CSX +1.9%) says it is closing mechanical shops in Corbin, Ky., affecting ~180 employees at the operation, as the company continues to respond to lower coal traffic volume.
- The Corbin shops are used primarily to serve locomotives and rail cars for coal trains moving from Central Appalachia to the eastern U.S.
- CSX says the closure is the result of reduced need for locomotive and car maintenance because of the significant decline of the region's coal traffic.
Oct. 19, 2015, 6:45 PM
- Railroads warn they are on track to miss a Dec. 31 deadline for installing complex new safety technology on trains that carry cargo, and are pushing Congress to extend the deadline or else oil, gasoline and other goods moved by rail could be stopped in their tracks, FuelFix reports.
- Major U.S. freight railroads, including BNSF (BRK.A, BRK.B), CSX and Norfolk Southern (NYSE:NSC), have said they will shut down many operations on Dec. 31 to comply with the deadline and avoid hefty fines; because railroads would be forced to begin shutting down services weeks earlier, they need a clear signal from Congress before the end of October, Association of American Railroads president Ed Hamberger says.
- The repercussions could be critical for the oil and gas industry, which has increasingly turned to rail to move crude and refined petroleum products across North America; railroads transported nearly 30K carloads of crude in 2010 but carried nearly 16x that amount in 2014.
Oct. 19, 2015, 6:14 PM
- CSX is added to J.P. Morgan’s Focus List, as the firm says it offers “the best upside [among rail stocks] to improving low track densities as the company leverages more locomotives into better service and intermodal growth.”
- CSX is JPM's “favored Eastern rail stock," and the firm thinks the company’s access to interior coal basins could aid utility customers in leveraging “emission control equipment by providing cheaper, higher sulfur coal than commonly found in Eastern coal basins.”
- JPM expects CSX’s service metrics to recover in 2016, with track densities and volumes being driven higher by the company’s locomotive fleet expansion, which the firm says is the largest in the group.
Oct. 15, 2015, 9:43 AM
- CSX Corp. (CSX +0.4%) says it plans to reduce train operations at its yard in Erwin, Tenn. because of sharply lower coal traffic through the region, resulting in the loss of ~300 jobs.
- CSX says it will close a locomotive service center, a project and car shop, and eliminate switching operations at the yard that primarily serves coal trains moving from central Appalachia.
- CSX says its coal revenue has declined by ~$1B during the past four years, as low natural gas prices and regulatory actions significantly reduced coal movements.
- Earlier: CSX says rail volume slump likely to persist (Oct 14)
Oct. 14, 2015, 3:59 PM
- CSX (CSX -1.8%) expects rail volumes to continue to fall through the end of the year, so CEO Michael Ward says in this morning's earnings conference call that the company will focus on productivity and raising prices over the coming year.
- With domestic coal carloads expected to drop 20% in Q3, CSX says it is looking to make each cargo train more productive by further stretching bulk cargo trains after adding ~10% more cars to their locomotives from a year ago.
- CSX says it expects to continue to gain market share and command strong prices, and the automotive industry should continue to boost shipments by rail, but chemicals will be lower in Q4, with crude oil volumes falling by at least 25% Q/Q, and metals will continue to be hit as a strong dollar fuels imports and domestic production falls.
- CSX says its core pricing rose 4.4% during Q3; "we continue to see a good pricing environment out there," Ward says.
Oct. 13, 2015, 5:33 PM
- CSX +1.1% AH after beating Q3 earnings estimates as gains in price were offset by a combination of lower fuel recovery, a 3% volume decline and continued transition in its business mix.
- Every category of freight hauled by CSX fell during Q3, but coal accounted for nearly half of the company's 8.7% Y/Y revenue drop, as coal revenue fell 19% to $583M from $721M a year earlier.
- CSX says it expects coal revenue to fall by ~$450M in FY 2015, which would represent a nearly 16% drop from $2.85B in 2014.
- CSX reaffirms its full-year expectations for EPS growth in the mid-single digits as it progresses toward a longer-term goal of a full-year operating ratio in the mid-60s; targets remain intact despite expectations for 2015 coal revenue to drop ~$450M Y/Y, with domestic coal volume declining by more than 10%, but the company sees significant coal headwinds continuing in 2016.
- CSX has been facing the same coal-related difficulties as other rail companies, but it typically earns ~20% of revenues from coal vs. 15% for the sector.
Oct. 13, 2015, 4:05 PM
- CSX (NYSE:CSX): Q3 EPS of $0.52 beats by $0.02.
- Revenue of $2.94B (-8.7% Y/Y) misses by $40M.
- Shares +1.8%.
Oct. 13, 2015, 1:12 PM
- Transportation stocks are weak today on macroeconomic concerns and with a guidance cut from Ryder capturing some attention. Investment firms have also chipped away at the airline and railroad sectors with downgrades and price target revisions.
- The move lower includes a wide variety of trucking, freight, and logistics stocks. FedEx (FDX -1.4%), Norfolk Southern (NSC -1.5%), CSX Corporation (CSX -1.7%), Knight Transportation (KNX -4.8%), J.B. Hunt Transport Services (JBHT -2.4%), Landstar System (LSTR -1.5%), Heartland Express (HTLD -2.7%), Air Transport Services Group (ATSG -1.6%), Allegiant Travel (ALGT -3.4%), Virgin America (VA -4.3%), and Hub Group (HUBG -2.9%) are all lower than broad market averages.
- The Dow Jones Transportation Average is off 1.76% vs. the S&P 500 -0.26%.
- Related ETFs: IYT, XTN.
Oct. 12, 2015, 5:43 PM
- Railroad stocks finished mostly lower after J.P. Morgan analyst Brian Ossenbeck cautioned investors not to assume the sector has bottomed ahead of Q3 earnings.
- Norfolk Southern (NYSE:NSC) ended -2.3% and was the biggest decliner among the Dow Jones Transports after Ossenbeck specifically named the company as "the one to avoid" after surging 11% in the two weeks ending last Friday.
- The analyst warns against "calling the bottom and buying the group solely on valuation," as his review of key end markets "still yields few green shoots while pressure on margins from negative mix is an emerging trend."
- Also, CSX -2.4%, GWR -2.1%, UNP -1.8%, KSU +0.1%.
Oct. 12, 2015, 5:35 PM
Oct. 9, 2015, 10:00 AM
- Federal investigators say a CSX (NYSE:CSX) train accident in West Virginia was caused by fault rail which wasn't found in two inspections.
- The determination resulted from a probe by the Federal Railroad Administration.
- The CSX accident in February created a huge fireball from ignited crude oil and originally drew criticism toward the railroad company.
Oct. 8, 2015, 2:14 PM
- Railcar manufacturer stocks are ripping strong gains
- Leading the charge is American Railcar Industries ARII with a 15.7% gain, while Greenbrier (GBX +10.1%), FreightCar America (RAIL +5.9%), and Trinity Industries (TRN +4.3%) are also in favor.
- Railroad stocks are also solidly ahead with Norfolk Southern (NSC +1.9%), CSX (CSX +2.3%), Union Pacific (UNP +1.5%), Genesee & Wyoming (GWR +2.2%), and Kansas City Southern (KSU +1.6%) all continuing an uptrend for the week.
- The strong sector move flies in the face of some analysts who have called for a downturn. A strong move higher by oil has helped to bring in some buyers.
- Previously: Not time to buy railroads, Barclays says in downgrading UNP, NSC (Oct. 05 2015)
Oct. 8, 2015, 9:08 AM
- CSX (NYSE:CSX) declares $0.18/share quarterly dividend, in line with previous.
- Forward yield 2.54%
- Payable Dec. 15; for shareholders of record Nov. 30; ex-div Nov. 25.
Oct. 5, 2015, 7:19 PM
- Union Pacific (NYSE:UNP) and Norfolk Southern (NYSE:NSC) are downgraded at Barclays, citing high inventory levels, contracting energy capex and a strong U.S. dollar.
- Barclays warns investors keen on acquiring the shares of quality companies while they seem cheap that it is “too early to get bullish on transports”; while investors are aware of North American industrial headwinds, the expectation of positive rail volume growth due to easy comps in 2016 may remain unmet.
- The firm likes UNP's long-term potential, but says mix erosion and a management team focused on reducing cost point to less robust growth outcomes in the near-term drives its downgrade to Equal Weight from Overweight.
- For NSC, the firm says continued service challenges now appear to be driving competitive intermodal share loss to CSX, on top of fuel revenue and coal headwinds, leading to the downgrade to Underweight from Equal Weight.
- At the same time, Cowen analysts cut 2016 earnings estimates for the rails, believing that many of the headwinds facing certain commodities will persist in the near to intermediate term; stock price targets are lowered for UNP, NSC, CNI, CP, CSX and KSU (Briefing.com).
- Earlier: Barclays abandons bull call on Union Pacific
Sep. 30, 2015, 6:31 PM
- Shares of railroad operators rose today as Goldman Sachs upgraded the sector to Attractive from Neutral, saying rail volumes continue to contract but the rate of change has begun to improve, which the firm sees as an early inflection indicator.
- The negatives in the rails appear well known as the sector has been under selling pressure since peaking in Q4 2014, Goldman says, believing the negative EPS revisions cycle for rails is over and that investor expectations now are achievable.
- The firm sees earnings as a catalyst for sector performance and thinks carloads will grow again in 2016 with 4% Y/Y growth in intermodal.
- Goldman upgraded Canadian Pacific (NYSE:CP) to Buy from Neutral and reiterated its Buy rating on Union Pacific (NYSE:UNP); it sees upside potential for Canadian National Railway (NYSE:CNI), CSX, Kansas City Southern (NYSE:KSU) and Norfolk Southern (NYSE:NSC) but keeps Neutral ratings on expectations the stocks will trade in-line with its broader transportation coverage universe.
Sep. 28, 2015, 7:12 AM
CSX Corp. is a transportation supplier company. It provides rail-based transportation services including traditional rail service and the transport of intermodal containers and trailers. The company through its principal operating subsidiary, CSX Transportation, Inc., provides an important link... More
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