Opinions Don Vialoux
CSX CorpCSXBUY ON WEAKNESSSep 04, 2015
Don VialouxStock 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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Railroads have very strong periods of seasonality. They tend to bottom right around the middle of October, and then move strongly higher right through until early January. You then have a period of time where they take a break into February, and then have another move from late February through until May. Chart shows this is clearly in a downward trend, but seems to be trying to base out at the current levels. Be patient. We are into a base building period right now. Any kind of weakness down to its recent lows is really an opportunity to be a buyer for seasonal trade, at least until January of next year.