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CSX (CSX) Dips More Than Broader Markets: What You Should Know

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CSX (CSX - Free Report) closed at $71.77 in the latest trading session, marking a -1.35% move from the prior day. This change lagged the S&P 500's 0.22% loss on the day. At the same time, the Dow lost 0.11%, and the tech-heavy Nasdaq lost 0.25%.

Heading into today, shares of the freight railroad had gained 5.65% over the past month, lagging the Transportation sector's gain of 7.19% and outpacing the S&P 500's gain of 3.57% in that time.

Wall Street will be looking for positivity from CSX as it approaches its next earnings report date. This is expected to be January 15, 2019. In that report, analysts expect CSX to post earnings of $1 per share. This would mark year-over-year growth of 56.25%. Meanwhile, our latest consensus estimate is calling for revenue of $3.14 billion, up 9.51% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.81 per share and revenue of $12.25 billion. These totals would mark changes of +65.65% and +7.34%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for CSX. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. CSX is currently a Zacks Rank #1 (Strong Buy).

Investors should also note CSX's current valuation metrics, including its Forward P/E ratio of 19.07. Its industry sports an average Forward P/E of 18.6, so we one might conclude that CSX is trading at a premium comparatively.

It is also worth noting that CSX currently has a PEG ratio of 1.43. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Transportation - Rail stocks are, on average, holding a PEG ratio of 1.51 based on yesterday's closing prices.

The Transportation - Rail industry is part of the Transportation sector. This industry currently has a Zacks Industry Rank of 19, which puts it in the top 7% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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