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CSX's Q4 Earnings & Revenues Beat Estimates, Increase Y/Y

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CSX Corporation’s (CSX - Free Report) fourth-quarter 2021 earnings of 42 cents per share surpassed the Zacks Consensus Estimate by a penny. The bottom line improved in double digits year over year owing to higher revenues.

Total revenues of $3,427 million outperformed the Zacks Consensus Estimate of $3296 million. The top line jumped 21.3% year over year owing to growth across all its businesses, and revenues from Quality Carriers, which the company acquired in July 2021.

Fourth-quarter operating income climbed 12% to $1,366 million. Operating ratio (operating expenses as a percentage of revenues) deteriorated to 60.1% from 57% in the prior-year quarter, with operating expenses increasing 28% year over year. With respect to this metric, lower the value, the better.

CSX expects capital expenditures to be approximately $2 billion in 2022.

CSX Corporation Price, Consensus and EPS Surprise

CSX Corporation Price, Consensus and EPS Surprise

CSX Corporation price-consensus-eps-surprise-chart | CSX Corporation Quote

Segmental Performance

Merchandise revenues climbed 4% year over year to $1,937 million in the quarter under review. However, merchandise volumes dipped 3% from the year-ago period, primarily due to 23% drop in automotive volumes as a result of semiconductor shortage.

Coal revenues ascended 39% year over year to $523 million in the reported quarter. Coal volumes decreased 2% with decline in domestic coal volumes due to lower shipments of utility coal resulting from an outage at a major coal-producing location.

Intermodal revenues augmented 16% year over year to $551 million. Volumes were flat year over year. While domestic shipments fell due to supply constraints, international shipments rose owing to strong demand, inventory replenishments and growth in rail volumes from east-coast ports.

Effective third-quarter 2021, CSX introduced a new segment — Trucking — which comprises the operations of Quality Carriers. Revenues from the segment totaled $210 million in the fourth quarter.

Other revenues jumped 87% to $206 million in the reported quarter.

Liquidity & Share Buyback

CSX, carrying a Zacks Rank #2 (Buy), exited the fourth quarter with cash and cash equivalents of $2,239 million compared with $3,129 million at the end of December 2020. Long-term debt totaled $16,185 million compared with $16,304 million at 2020-end. As of Dec 31, 2021, net cash provided by operating activities was $5,099 million compared with $4,263 million in the year-earlier period.

As of Dec 31, 2021, CSX repurchased 90 million shares for $2,886 million.

Sectorial Snapshot

Within the broader Transportation sector, J.B. Hunt Transport Services (JBHT - Free Report) , United Airlines (UAL - Free Report) and Delta Air Lines (DAL - Free Report) recently reported fourth-quarter 2021 results.

J.B. Hunt Transport Services, carrying a Zacks Rank #1 (Strong Buy), reported fourth-quarter 2021 earnings of $2.28 per share, surpassing the Zacks Consensus Estimate of $1.99. The bottom line surged 58.3% year over year on the back of higher revenues across all segments. You can see the complete list of today’s Zacks #1 Rank stocks here.

J.B. Hunt’s operating revenues of $3,497 million also outperformed the Zacks Consensus Estimate of $3,287.8 million. The top line jumped 27.7% year over year. Total operating revenues, excluding fuel surcharges, rose 21.7% year over year.

United Airlines, carrying a Zacks Rank #4 (Sell), incurred a loss (excluding 39 cents from non-recurring items) of $1.60 per share in the fourth quarter of 2021, narrower than the Zacks Consensus Estimate of a loss of $2.23. The amount of loss narrowed by 77.1% year over year.

United Airlines’ operating revenues of $8,192 million also outperformed the Zacks Consensus Estimate of $7,930.9 million. The top line surged more than 100% year over year, with passenger revenues, accounting for 84% of the top line, soaring 185.4% to $6,878 million.

Delta, carrying a Zacks Rank #5 (Strong Sell), reported fourth-quarter 2021 earnings (excluding 86 cents from non-recurring items) of 22 cents per share, outpacing the Zacks Consensus Estimate of 15 cents. Results came against the year-ago quarter’s loss of $2.53 per share. Strong holiday travel demand and favorable pricing aided the December quarter’s results.

Delta’s revenues came in at $9,470 million, which not only beat the Zacks Consensus Estimate of $9,232.1 million, but also soared in excess of 100% from the year-ago figure as people resorted to air travel during the holidays.