Jim Cramer - Mad MoneyCSX CorpCSXBUYSep 05, 2025

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.  

It is in shipping (barge) and rail. Although it is still a good company he swapped into CP Rail since it is good for the long term with a direct connection from Canada through the US.

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.

Last week, they reported a good quarter with stable volumes, up 1% YOY, led by automotives, chemicals (up 5%) and fertilizer (4%). Revenues beat, but earnings were down 8% over the year. Also, they raised guidance.

Run by a great CEO. The company is becoming more customer-oriented. He targets $40.

Really likes the rails, a cyclical group. CN, CP, CSX trade as a team. Transport is doing quite well, and the rails have a lot of leverage in their business models. Done a great job managing operating expenses.