Opinions Stuart Hinshelwood
CSX CorpCSXTOP PICKJul 12, 2013
Stock price when the opinion was issued
As of Jun 05, 2026. Market Open.
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It broke out last December. After consolidating, it's breaking out again. For traders, he likes $43, the rising 50-day average, at a minimum will lock in a gain but allow you to stay in the stock long enough. For investors, $43-44 is support and will take out $47. There's earnings growth. Will pass $50.
The market is speculating if CSX will merge with another railroad, but CS has only 3 years under this president to do it, since another president likely won't give that much latitude to an already-concentrated industry. And the Norfolk Southern-Union Pacific is hitting speed bumps. He wouldn't buy CSX based on takeover speculation, but on improving business. Yesterday's quarter: a modest top and bottom line miss, but strong operating metrics and a 1% YOY volume increase and offered a positive full-year forecast including revenue growth and operating margin expansion. CSX will do fine in a stagnant economy and be a big winner if the economy picks up.
Will benefit 6-8% from US tax cuts to come and a strong US economy. CSX reduced their share count by 34% in the last 10 years, while dividends have risen.
(Analysts’ price target is $38.59)
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Good strong class 1 east coast railroad. One of the only big rails that you can buy at a decent valuation. Good balance sheet. Rail volumes are starting to improve. If you believe in the US housing recovery, although at a slower pace as he does, and if you believe the economy in the US is going to continue to get better, this will participate very nicely in that. Ships chemicals, housing products, furniture, autos as well as coal and grains. Coal is baked into the stock price and grain shipments are down about 11%. They are doing everything they can to offset these 2 things. The other opportunity for them is crude on rail, which is going to be a multiyear story.