Core Viewpoint - CSX is facing financial challenges due to rising operating expenses, despite commendable efforts in safety and shareholder rewards [1][4]. Group 1: Safety and Operational Initiatives - CSX has launched a three-year initiative aimed at enhancing safety, focusing on cultural transformation and proactive risk management [2]. - The initiative builds on the ONE CSX program, emphasizing inclusivity and respect within the organization [2]. Group 2: Shareholder Returns - In Q2 2024, CSX repurchased shares worth $16 million and announced a 9.1% increase in its quarterly dividend to 12 cents per share [3]. - The company has consistently returned significant capital to shareholders, totaling over $3.7 billion in 2021, $5.58 billion in 2022, and $4.36 billion in 2023 [3]. Group 3: Financial Performance and Challenges - CSX's top line experienced a significant decline in Q2 2024, with overall volume down 3% year over year, impacting domestic shipments [4]. - The bottom line decreased by 9% year over year due to unfavorable pricing and a mix of utility costs, compounded by a 2% rise in total labor expenses compared to Q2 2023 [4]. - Year-to-date, CSX shares have declined by 3.5%, while the industry average fall is 1.5% [4].

Core Viewpoint - The analysis suggests that CSX stock is a better investment choice compared to Norfolk Southern due to its superior valuation, revenue growth, profitability, and financial position [1]. Group 1: Stock Performance - Norfolk Southern stock has gained 15% from $220 in early January 2021 to around $250, while CSX stock has increased by 10% from $30 to $33 during the same period [2]. - Norfolk Southern's returns were 27% in 2021, -16% in 2022, and -2% in 2023, while CSX's returns were 26%, -17%, and 13%, respectively [2]. Group 2: Revenue Growth - CSX's revenue grew at an average annual rate of 11.9%, from $10.6 billion in 2020 to $14.7 billion in 2023, while Norfolk Southern's revenue increased at 7.9%, from $9.8 billion to $12.2 billion [4]. - Norfolk Southern's total volume of carloads and intermodal units rose only 0.9% from 2020 to 2023, but its average revenue per carload increased by 23% [4]. Group 3: Profitability - Norfolk Southern's operating margin declined from 37.4% in 2020 to 35.2% in 2023, while CSX's margin decreased from 41.3% to 37.9% during the same period [7]. - CSX's operating margin for the last twelve months is 37.1%, compared to 34.4% for Norfolk Southern [7]. Group 4: Financial Risk - CSX has a debt-to-equity ratio of 29%, slightly lower than Norfolk Southern's 30% [8]. - CSX's cash as a percentage of assets is 3%, compared to 1% for Norfolk Southern, indicating a better cash position [8]. Group 5: Valuation and Future Prospects - CSX is trading at 17x its expected earnings of $1.94 per share in 2024, while Norfolk Southern is at 21x its expected earnings of $11.76 [9]. - CSX's valuation multiple is expected to trend higher due to its superior revenue growth prospects [9].

Company Overview - CSX is a major railroad with a rich history, originating from the Baltimore & Ohio (B&O) railroad, which was the first in America, and has grown through numerous mergers and acquisitions [2][3] - The company operates significant portions of the eastern US and has undergone strategic changes to improve service and efficiency under new CEO Joe Hinrichs [5][6] Business Strategy - CSX has shifted from Precision Railroading (PSR) practices, which focused on short-term financial results, to a more balanced approach that prioritizes employee experience and customer service [4][5] - The company is investing in infrastructure upgrades, including the Howard Street tunnel project costing $466 million, aimed at enhancing freight capacity and service [6][7] Financial Performance - For the latest quarter, CSX reported flat revenue of $3.7 billion year-over-year, with operating income also flat but showing an 8% increase quarter-over-quarter [10] - The company distributed $1.3 billion in returns to investors year-to-date, indicating a commitment to shareholder value [10] Market Trends - Traffic in the early part of the year was weak but has shown signs of recovery, with a 4% year-over-year decline in overall traffic [8] - Long-term trends favoring rail over other transport options due to rising energy costs and shifts in manufacturing back to the US are expected to benefit CSX [9][16] Analyst Insights - Analysts highlight CSX as one of the most efficient operators in the rail industry, with a solid balance sheet and a history of dividends and stock buybacks [16] - The company is projected to see revenue growth of 2% year-over-year in 2024 and 5% in 2025, despite facing temporary headwinds from coal contracts and wage increases [16]

JACKSONVILLE, Fla., Sept. 05, 2024 (GLOBE NEWSWIRE) -- CSX Corp. (NASDAQ: CSX) President and Chief Executive Officer, Joe Hinrichs, will address the 12th Annual Morgan Stanley Laguna Conference in California on Thursday, September 12, at 9:20 a.m. Pacific time. This address will be broadcast live via webcast at http://investors.csx.com. A replay will be available following the conclusion of this event. This announcement, as well as additional financial information, is available on the company’s website at h ...

A month has gone by since the last earnings report for CSX (CSX) . Shares have added about 2.1% in that time frame, underperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is CSX due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts. Earnings Beat at CSX  in Q2CSX's second-quarter 2024 earnings per ...

CSX Corporation (CSX) has inked new five-year tentative collective bargaining agreements with two more labor unions.The tentative deals with the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers & Helpers and the Transportation Communications Union have been inked four months prior to the amendment of the current collective agreements under the federal Railway Labor Act.The deals are effective based on the pending ratification by the unions’ membership at CSX.So far, CSX ha ...

JACKSONVILLE, Fla., Aug. 30, 2024 (GLOBE NEWSWIRE) -- CSX (NASDAQ: CSX) today announced it has secured new five-year tentative collective bargaining agreements with International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers & Helpers (IBB) and the Transportation Communications Union (TCU). “The latest tentative agreements build upon the momentum that we have created alongside our union partners and allows us to solidify the foundation at CSX where every employee feels valued and emp ...

JACKSONVILLE, Fla., Aug. 23, 2024 (GLOBE NEWSWIRE) -- CSX (NASDAQ: CSX) today announced that it has reached new tentative five-year collective bargaining agreements with seven additional labor unions. These agreements cover the following groups: The Brotherhood of Maintenance of Way Employes Division of the International Brotherhood of Teamsters (BMWED), covering maintenance of way employees;The International Association of Machinists & Aerospace Workers (IAM) covering machinists and roadway mechanics.The I ...

JACKSONVILLE, Fla., Aug. 22, 2024 (GLOBE NEWSWIRE) -- CSX (NASDAQ: CSX) today announced it has secured new five-year tentative collective bargaining agreements with the International Association of Sheet Metal, Air, Rail and Transportation Workers – Mechanical Division (SMART-MD) and the American Train Dispatchers Association (ATDA). “We are continually listening to our valued front-line employees about what is needed to make positive and impactful improvements to our work environment. Their well-being is c ...

JACKSONVILLE, Fla., Aug. 21, 2024 (GLOBE NEWSWIRE) -- CSX Corp. (NASDAQ: CSX) announced today that the railroad has reached tentative agreements on new five-year collective bargaining agreements with the Transportation Communications Union (TCU), the Brotherhood of Railway Carmen (BRC), and General Committee of Adjustment GO-049 of the International Association of Sheet Metal, Air, Rail and Transportation Workers – Transportation Division (SMART-TD), representing train service employees on the Northern Mid- ...