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Does CSX Stock's Q3 Earnings Beat Justify a Buy Decision Today?
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Key Takeaways
CSX Q3 earnings surged 29.5% to 57 cents per share, beating estimates by 9.6%, as revenues climbed 12%.
Merchandise, intermodal and coal revenues grew 11%, 20% and 10%, respectively, lifting operating margins.
CSX stock up 41.6% YTD, outperforming the rail industry, while upward earnings revisions bolster sentiment.
On Oct. 21, 2026, CSX Corporation (CSX - Free Report) reported solid third-quarter 2026 earnings wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate and improved year over year.
Quarterly earnings of 57 cents per share surpassed the Zacks Consensus Estimate of 52 cents by 9.6%. Earnings rose 29.5% year over year to 44 cents per share, up from the prior-year adjusted figure that excluded a goodwill impairment charge. Total revenues increased 12% year over year to $4.02 billion, beating the Zacks Consensus Estimate of $3.95 billion by 1.7%. Higher fuel surcharge revenues, volume growth and improved pricing across merchandise, intermodal and coal supported the top line. Total volumes increased 5% year over year.
Given this backdrop, the question that naturally arises is: Should investors buy, hold, or sell CSX stock now? A more in-depth analysis is needed to make that determination. Before diving into CSX’s investment prospects, let’s take a glance at its latest quarterly numbers.
Highlights of CSX’s Q3 Earnings
Apart from reporting better-than-expected results, CSX also witnessed favorable segmental strength. Merchandise revenues increased 11% year over year to $2.45 billion. Merchandise volumes rose 3% year over year, while revenues per unit improved 8% to $3,613. Intermodal revenues increased 20% year over year to $634 million. Intermodal segment volumes advanced 7% to 820,000 units, while revenues per unit grew 13% year over year to $773. Coal revenues rose 10% year over year to $537 million, with volumes up 2% to 188,000 units and revenue per unit up 7% to $2,856. Trucking revenues increased 10% year over year to $227 million, while other revenues grew 7% to $166 million.
Operating income increased 44.4% year over year to $1.57 billion. Operating margin expanded to 39.1% from the prior-year adjusted margin of 34.9%, representing an improvement of 420 basis points.
Total operating expenses declined 2% year over year to $2.45 billion. The reduction reflected the absence of a $164 million goodwill impairment charge recorded in the prior-year quarter, along with operating cost savings.
Fuel expenses surged 60.5% year over year to $451 million as locomotive fuel prices increased 67% to $4.24 per gallon. Lower fuel consumption and improved efficiency partially offset the impact of higher prices.
For CSX, the Federal Railroad Administration personal injury frequency index improved 17% to 0.97, while the train accident rate declined 5% to 2.77. Fuel efficiency improved 2% to 0.92 gallons per 1,000 gross ton-miles in the third quarter.
What Do Earnings Estimates Say for CSX?
The positive sentiment surrounding CSX stock is evident from the fact that the Zacks Consensus Estimate for the fourth quarter of 2026 earnings has been revised upward in the past 60 days. The consensus mark for 2026 and 2027 earnings has also been projected upward in the past 60 days.
The favorable estimate revisions indicate brokers’ confidence in the stock.
Image Source: Zacks Investment Research
CSX Stock’s Price Performance
CSX stock have gained 41.6% so far this year, outperforming the Zacks Transportation - Rail industry’s 26.3% surge, as well as that of other industry players, Norfolk Southern Corporation (NSC - Free Report) and Canadian National Railway Company (CNI - Free Report) ), within the same time frame.
CSX Stock’s YTD Price Comparison
Image Source: Zacks Investment Research
Attractive Valuation Picture Adds to CSX Luster
CSX looks cheap from a valuation standpoint. Based on the forward 12-month price-to-sales ratio (P/S-F12M), CSX trades at a discount to the industry.
The stock has a forward 12-month P/S-F12M of 5.94X compared with 8.70X for the industry over the past five years. These factors indicate that the stock’s valuation is attractive.
CSX P/S Ratio (Forward 12 Months) Vs. Industry
Image Source: Zacks Investment Research
Final Thoughts
CSX’s outlook is supported by better volume, pricing and cost execution, with management raising its full-year revenue, margin and free cash flow expectations. Safety trends also remain favorable, while broader labor agreements and continued dividends and share repurchases support the operating and shareholder-return profile.
With these tailwinds, including the railroad operator's solid third-quarter results, potential investors can add CSX stock to their portfolios for healthy returns. The company’s Zacks Rank #2 (Buy) further supports our thesis. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
View the Zacks #1 Rank List
Image: Bigstock
Does CSX Stock's Q3 Earnings Beat Justify a Buy Decision Today?
Key Takeaways
On Oct. 21, 2026, CSX Corporation (CSX - Free Report) reported solid third-quarter 2026 earnings wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate and improved year over year.
Quarterly earnings of 57 cents per share surpassed the Zacks Consensus Estimate of 52 cents by 9.6%. Earnings rose 29.5% year over year to 44 cents per share, up from the prior-year adjusted figure that excluded a goodwill impairment charge. Total revenues increased 12% year over year to $4.02 billion, beating the Zacks Consensus Estimate of $3.95 billion by 1.7%. Higher fuel surcharge revenues, volume growth and improved pricing across merchandise, intermodal and coal supported the top line. Total volumes increased 5% year over year.
Given this backdrop, the question that naturally arises is: Should investors buy, hold, or sell CSX stock now? A more in-depth analysis is needed to make that determination. Before diving into CSX’s investment prospects, let’s take a glance at its latest quarterly numbers.
Highlights of CSX’s Q3 Earnings
Apart from reporting better-than-expected results, CSX also witnessed favorable segmental strength. Merchandise revenues increased 11% year over year to $2.45 billion. Merchandise volumes rose 3% year over year, while revenues per unit improved 8% to $3,613. Intermodal revenues increased 20% year over year to $634 million. Intermodal segment volumes advanced 7% to 820,000 units, while revenues per unit grew 13% year over year to $773. Coal revenues rose 10% year over year to $537 million, with volumes up 2% to 188,000 units and revenue per unit up 7% to $2,856. Trucking revenues increased 10% year over year to $227 million, while other revenues grew 7% to $166 million.
Operating income increased 44.4% year over year to $1.57 billion. Operating margin expanded to 39.1% from the prior-year adjusted margin of 34.9%, representing an improvement of 420 basis points.
Total operating expenses declined 2% year over year to $2.45 billion. The reduction reflected the absence of a $164 million goodwill impairment charge recorded in the prior-year quarter, along with operating cost savings.
Fuel expenses surged 60.5% year over year to $451 million as locomotive fuel prices increased 67% to $4.24 per gallon. Lower fuel consumption and improved efficiency partially offset the impact of higher prices.
For CSX, the Federal Railroad Administration personal injury frequency index improved 17% to 0.97, while the train accident rate declined 5% to 2.77. Fuel efficiency improved 2% to 0.92 gallons per 1,000 gross ton-miles in the third quarter.
What Do Earnings Estimates Say for CSX?
The positive sentiment surrounding CSX stock is evident from the fact that the Zacks Consensus Estimate for the fourth quarter of 2026 earnings has been revised upward in the past 60 days. The consensus mark for 2026 and 2027 earnings has also been projected upward in the past 60 days.
The favorable estimate revisions indicate brokers’ confidence in the stock.
CSX Stock’s Price Performance
CSX stock have gained 41.6% so far this year, outperforming the Zacks Transportation - Rail industry’s 26.3% surge, as well as that of other industry players, Norfolk Southern Corporation (NSC - Free Report) and Canadian National Railway Company (CNI - Free Report) ), within the same time frame.
CSX Stock’s YTD Price Comparison
Attractive Valuation Picture Adds to CSX Luster
CSX looks cheap from a valuation standpoint. Based on the forward 12-month price-to-sales ratio (P/S-F12M), CSX trades at a discount to the industry.
The stock has a forward 12-month P/S-F12M of 5.94X compared with 8.70X for the industry over the past five years. These factors indicate that the stock’s valuation is attractive.
CSX P/S Ratio (Forward 12 Months) Vs. Industry
Final Thoughts
CSX’s outlook is supported by better volume, pricing and cost execution, with management raising its full-year revenue, margin and free cash flow expectations. Safety trends also remain favorable, while broader labor agreements and continued dividends and share repurchases support the operating and shareholder-return profile.
With these tailwinds, including the railroad operator's solid third-quarter results, potential investors can add CSX stock to their portfolios for healthy returns. The company’s Zacks Rank #2 (Buy) further supports our thesis. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.