CSX stock gains on strong earnings, analyst upgrade
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CSX Corp. (NASDAQ:CSX) stock rode higher on Thursday after reporting a strong second quarter earnings that added to optimism on Wall Street.

For the second quarter, the Florida-based railroad posted 27.8% growth in revenue from the year prior and also pushed past profit expectations while improving efficiency from the first quarter. Additionally, management remained bullish on the prospects for a coming inflection point for the rail industry due in the coming months.
After the results, Loop Capital analyst Rick Paterson advised clients the stock is an attractive option for investors. Paterson raised his rating on the stock to âBuyâ from âHoldâ held prior to the quarterly report.
âCSX, and the rest of the railroads, should be good places to park some money in the event of economic softness in 2023 given they always have pricing power and have easy comps next year because of all the meltdowns this year,â he explained. âWeâre looking at historically low bars for operating efficiency and, as a consequence, significantly constrained 2022 volumes to match against next year.â
The stock jumped 4.47% in premarket hours.
To be sure, Paterson promoted caution the near term projections offered by management.
âWeâre raising our rating on CSX to Buy, but itâs unrelated to managementâs assurance above that theyâre going to turn this thing around in the next 10 weeks,â he clarified. âWe hope of course that CSX is right on the timing, but we wouldnât recommend investors buy the stock with this expectation.â
He added that supply chain problems take time to be sorted out and will rely upon numerous partners beyond CSX Corporationâs (CSX) control. As such, a more likely inflection point is found in 2023 after a light recession.
Read the earnings call transcript.