CSX Corporation CSX is set to release first-quarter 2016 results, after markets close on Apr 12.
In the last quarter, the company posted a positive 4.35% earnings surprise. Let’s see how things are shaping up for this announcement.
Factors at Play
Coal is a key revenue-generating commodity for railroad operators. Thus, a decline in domestic coal shipments hurts CSX Corp.’s operations to a considerable extent. Meanwhile, a strong U.S. dollar, lower fuel surcharges from customers owing to declining fuel costs and sluggish carload growth at the energy sector are likely to impact the company’s top line.
Our proven model does not conclusively show that CSX Corp. is likely to beat the Zacks Consensus Estimate this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) for this to happen. Unfortunately, this is not the case here as elaborated below.
Zacks ESP: Earnings ESP for the company stands at -2.7% as the Most Accurate estimate is 36 cents while the Zacks Consensus Estimate is 37 cents.
Zacks Rank: CSX Corp. carries a Zacks Rank #4 (Sell).
Please note that we caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies you may want to consider as our model shows these have the right combination of elements to post an earnings beat this quarter.
Canadian National Railway Company CNI with an Earnings ESP of +3.03% and a Zacks Rank #2.
JB Hunt Transport Services Inc. JBHT with an Earnings ESP of +1.18% and a Zacks Rank #3.
Canadian Pacific Railway Limited CP with an Earnings ESP of +2.29% and a Zacks Rank #2.
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CSX CORP (CSX): Free Stock Analysis Report
CDN NATL RY CO (CNI): Free Stock Analysis Report
CDN PAC RLWY (CP): Free Stock Analysis Report
HUNT (JB) TRANS (JBHT): Free Stock Analysis Report
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Zacks Investment Research CSX Research -- Mutual Funds Top 10 Holdings include "CSX"
CNI Research -- Mutual Funds Top 10 Holdings include "CNI"
JBHT Research -- Mutual Funds Top 10 Holdings include "JBHT"
CP Research -- Mutual Funds Top 10 Holdings include "CP"