CSX Outlook Supported by Cost Cuts, Pricing as Savings Slow, UBS Says

MT Newswires Live10-23 01:12

CSX (CSX) has meaningful cost savings drivers in 2027 and should benefit from stronger pricing overall, even as the savings from cost cuts get smaller, UBS said in a note Thursday.

CSX reported Q3 earnings per share of $0.57, above UBS's $0.54 estimate and the $0.53 consensus estimate, and UBS raised its 2027 EPS estimate to $2.42 from $2.33, according to the note.

CSX plans about 100 productivity initiatives in 2027, but the company expects savings to be smaller than in 2026 after this year's big overhead cuts, UBS noted. The firm sees crew scheduling and maintenance automation to be meaningful cost savings drivers for the company in 2027, according to the note.

Intermodal volumes rose 6.8% in Q3 and new services and higher truckload rates should drive more growth in 2027, along with pricing gains that begin in Q2 and build through Q3, UBS said.

UBS kept its buy rating and raised its price target to $60 from $54, citing productivity gains, stronger pricing and volume growth.

Price: 51.85, Change: +3.45, Percent Change: +7.13

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