Services

CSX Slumps on Mixed Earnings

Chris Lange

Published: January 12, 2016 4:22 pm

Last Updated: January 13, 2020 3:07 pm

CSX Corp. (NYSE: CSX) reported its fourth quarter financial results after the markets closed Tuesday. The company had $0.48 in earnings per share (EPS) on $2.78 billion in revenue compared to consensus estimates from Thomson Reuters that called for $0.46 in EPS on $2.86 billion in revenue. The same period from the previous year had $0.49 in EPS on $3.19 billion in revenue.

The reaction to these earnings seemingly imply that despite mixed earnings not everything was priced in. Also the weakness in coal during 2015 was not good for CSX as the stock dropped roughly 30% over the course of the year.

For the full year 2015, CSX generated $11.8 billion in revenue as growth in intermodal, automotive and minerals markets partially offset continued significant declines in coal.

Michael J. Ward, Chairman and CEO of CSX, commented on earnings:

CSX delivered solid results in 2015 by balancing strong service with compelling cost control and efficiency gains despite a market challenged by low commodity prices and global impacts of the strong U.S. dollar.

He added:

With negative global and industrial market trends projected for 2016, full-year earnings per share are expected to be down compared to 2015.  CSX will continue to be rigorous about efficiency, resources and service quality in order to maximize shareholder value and achieve a mid-60s operating ratio longer term.

Shares of CSX closed Tuesday up 0.7% at $23.69, with a consensus analyst price target of $29.83 and a 52-week trading range of $23.18 to $37.67. Following the release of the earnings report, the stock was down 2.2% at $23.17 in the after-hours trading session.