CSX Corporation (CSX - Free Report) is being aided by strong freight demand and favorable pricing despite volume softness due to supply chain woes.
The intermodal segment’s performance is being driven by strong demand on the domestic front. Amid solid freight demand, higher pricing across all segments is driving CSX’s top line. With freight demand likely to remain strong, management anticipates double-digit growth in operating income and revenues for 2022 from the respective year-ago reported figures. High export coal prices and fuel surcharge revenues are expected to bolster the top line in the near term.
CSX’s measures to reward its shareholders through dividends and share buybacks are encouraging. In February, the company announced a 7.5% hike in its quarterly dividend to 10 cents per share. In the March quarter, CSX rewarded shareholders in excess of $1.2 billion through buybacks (approximately $1 billion) and dividends (more than $200 million).
The company’s sound liquidity position is an added positive. Its cash and cash equivalents stood at $2,032 million at the end of the first quarter of 2022, much higher than the current debt of $317 million, implying that the company has sufficient cash to meet its current debt obligations.
In light of the abovementioned positive factors, we believe investors should hold on to the CSX stock for now, as suggested by its Zacks Rank #3 (Hold).
Strong freight demand is expected to continue to drive the company’s performance going forward. The Zacks Consensus Estimate for the company’s current-quarter earnings has been revised upward by 2 cents in the past 60 days. The same for 2022 earnings has been revised northward by 2.2%.
Key Picks
Some better-ranked stocks within the broader Transportation sector are as follows:
Golar LNG Limited (GLNG - Free Report) flaunts a Zacks Rank #1 (Strong Buy). The company has a stellar earnings surprise history, having outperformed the Zacks Consensus Estimate in three of the preceding four quarters and missed once, the average surprise being 49.8%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Golar LNG have rallied more than 100% in a year.
Star Bulk Carriers (SBLK - Free Report) sports a Zacks Rank #1. The company’s earnings have surpassed the Zacks Consensus Estimate in two of the preceding four quarters and missed twice, the average negative surprise being 2%.
Shares of Star Bulk have gained more than 97% in a year.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
CSX Corporation (CSX - Free Report) is being aided by strong freight demand and favorable pricing despite volume softness due to supply chain woes.
The intermodal segment’s performance is being driven by strong demand on the domestic front. Amid solid freight demand, higher pricing across all segments is driving CSX’s top line. With freight demand likely to remain strong, management anticipates double-digit growth in operating income and revenues for 2022 from the respective year-ago reported figures. High export coal prices and fuel surcharge revenues are expected to bolster the top line in the near term.
CSX’s measures to reward its shareholders through dividends and share buybacks are encouraging. In February, the company announced a 7.5% hike in its quarterly dividend to 10 cents per share. In the March quarter, CSX rewarded shareholders in excess of $1.2 billion through buybacks (approximately $1 billion) and dividends (more than $200 million).
The company’s sound liquidity position is an added positive. Its cash and cash equivalents stood at $2,032 million at the end of the first quarter of 2022, much higher than the current debt of $317 million, implying that the company has sufficient cash to meet its current debt obligations.
In light of the abovementioned positive factors, we believe investors should hold on to the CSX stock for now, as suggested by its Zacks Rank #3 (Hold).
Strong freight demand is expected to continue to drive the company’s performance going forward. The Zacks Consensus Estimate for the company’s current-quarter earnings has been revised upward by 2 cents in the past 60 days. The same for 2022 earnings has been revised northward by 2.2%.
Key Picks
Some better-ranked stocks within the broader Transportation sector are as follows:
Golar LNG Limited (GLNG - Free Report) flaunts a Zacks Rank #1 (Strong Buy). The company has a stellar earnings surprise history, having outperformed the Zacks Consensus Estimate in three of the preceding four quarters and missed once, the average surprise being 49.8%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Golar LNG have rallied more than 100% in a year.
Star Bulk Carriers (SBLK - Free Report) sports a Zacks Rank #1. The company’s earnings have surpassed the Zacks Consensus Estimate in two of the preceding four quarters and missed twice, the average negative surprise being 2%.
Shares of Star Bulk have gained more than 97% in a year.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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