CSX (CSX) is expected to deliver a year-over-year decline in earnings on lower revenues when it reports results for the quarter ended September 2025. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on October 16. On the ...

Financial Data and Key Metrics Changes - Adjusted EBITDA for Q2 was $45.9 million, up 30% from Q1 2025 and up 34% from Q2 2024 [18] - The company expects annual EBITDA to exceed $450 million, including the acquisition of Wheeling and Lake Erie Railway [19] Business Line Data and Key Metrics Changes - TransStar reported adjusted EBITDA of $20.7 million, up 4% from Q1 2025 [20] - Long Ridge generated $23 million of EBITDA in Q2, up from $18.1 million in Q1 [21] - Jefferson's EBITDA was $11.1 million, up from $8 million in Q1 [22] Market Data and Key Metrics Changes - The Wheeling and Lake Erie Railway generated total revenue of approximately $150 million for the latest twelve months [7] - The company expects $20 million of annual cost savings from the Wheeling acquisition, primarily from network efficiencies [11] Company Strategy and Development Direction - The company announced a major acquisition of Wheeling and Lake Erie Railway for $1.05 billion, expected to transform its freight rail segment [6] - Plans to refinance the corporate balance sheet to increase free cash flow and provide flexibility for future growth [6] - The company aims to grow its freight rail segment and may consider monetizing other assets to focus on rail acquisitions [68] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving $200 million of targeted annual EBITDA from the combined rail companies by 2026 [10] - The company anticipates significant growth in revenues and EBITDA in 2025 due to the Wheeling acquisition and contracted business [19] - Management noted a mild pickup in M&A activity in the rail sector and sees opportunities for further acquisitions [44] Other Important Information - The company completed financing for its Phase II transloading project at Repauno, issuing $300 million of tax-exempt debt [22] - The company is actively pursuing additional acquisitions of complementary railroads to diversify revenue and commodity base [24] Q&A Session Summary Question: Can you talk about the synergies of putting TransStar and Wheeling together? - Management highlighted the expected $20 million of annual savings from the integration, emphasizing the strategic fit and immediate efficiencies [33][34] Question: What are the implications of the Wheeling acquisition on diversification? - The acquisition is expected to significantly enhance diversification, with TransStar's reliance on U.S. Steel decreasing from 85% to one-third of total business [36][38] Question: Are there continued opportunities for consolidation in the rail space? - Management noted a mild pickup in M&A activity and expressed confidence in pursuing additional acquisitions [44] Question: Can you elaborate on the $70 million EBITDA opportunity at Long Ridge? - Management clarified that the $70 million includes contracted revenue and potential future growth from data center opportunities, which are not yet included in the bar chart [48][49] Question: What is the status of Phase III at Repauno? - The permitting process is expected to be finalized by September 30, with a total cost of about $200 million and a projected payback period of two years [55] Question: How will the $1 billion of preferred stock impact cash flow? - The preferred stock will not trap cash, allowing significant excess cash flow to be distributed to the holding company after debt service [78]

Core Viewpoint - CSX is anticipated to report a year-over-year decline in earnings and revenues for the quarter ended March 2025, which could significantly influence its stock price depending on the actual results compared to estimates [1][2]. Earnings Expectations - The upcoming earnings report is expected to be released on April 16, 2025, with a consensus estimate of $0.38 per share, reflecting a year-over-year decrease of 17.4% [3]. - Revenues are projected to be $3.55 billion, down 3.7% from the same quarter last year [3]. Estimate Revisions - The consensus EPS estimate has been revised 0.2% higher in the last 30 days, indicating a slight reassessment by analysts [4]. - The Most Accurate Estimate for CSX is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -0.79%, suggesting a bearish outlook from analysts [10][11]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive or negative reading can predict the likelihood of actual earnings deviating from consensus estimates, with a strong predictive power for positive readings [7][8]. - CSX currently holds a Zacks Rank of 3, which complicates the prediction of an earnings beat [11]. Historical Performance - In the last reported quarter, CSX was expected to post earnings of $0.43 per share but delivered $0.42, resulting in a surprise of -2.33% [12]. - Over the past four quarters, CSX has beaten consensus EPS estimates two times [13]. Conclusion - CSX does not appear to be a compelling candidate for an earnings beat, and investors should consider other factors when making decisions regarding the stock ahead of the earnings release [16].