Is CSX Corporation Stock Underperforming the Dow?

With a market cap of $56.9 billion, Jacksonville, Florida-based CSX Corporation (CSX) is a leading transportation company in the United States, specializing in rail-based freight transportation services. Through its subsidiary, CSX Transportation, it operates a vast rail network spanning approximately 20,000 route miles across 26 states, the District of Columbia, and parts of Canada.

Companies valued at $10 billion or more are generally classified as “large-cap” stocks, and CSX fits this criterion perfectly. CSX provides essential links in the supply chain, transporting a variety of goods, including chemicals, agricultural products, automotive materials, and coal. It also offers intermodal services, rail-to-truck transfers, and short-term locomotive leasing.

Shares of the freight railroad are trading 20.6% below its 52-week high of $38.03. CSX has declined 8.3% over the past three months, a steeper decline than the broader Dow Jones Industrials Average’s ($DOWI) 4.1% dip over the same time frame.

In the longer term, CSX stock is down 6.4% on a YTD basis, which is more pronounced compared to DOWI’s 2% decrease. In addition, shares of CSX have decreased 18.3% over the past 52 weeks, lagging behind DOWI’s 7.7% return over the same time frame.

CSX has been trading below its 50-day and 200-day moving averages since December last year. 

CSX shares fell 2.9% following its Q4 2024 earnings release on Jan. 23 due to disappointing financial results, including adjusted EPS of $0.42, which missed analysts' expectations. Revenue fell 4% year-over-year to $3.5 billion, slightly below the forecast, driven by a sharp 20% decline in coal revenue and lower fuel surcharges. Operating income dropped 8.3% to $1.2 billion, reflecting the impact of a goodwill impairment charge and overall weaker performance.

In addition, CSX Corporation has lagged behind its rival, Union Pacific Corporation (UNP), which has declined 2.5% over the past 52 weeks and saw a 4.4% rise on a YTD basis. 

Due to CSX’s weak performance, analysts remain moderately optimistic about its prospects. The stock has a consensus rating of “Moderate Buy” from the 26 analysts covering the stock, and as of writing, the stock is trading below the mean price target of $36.48.