CSX stock rating upgraded to Outperform by RBC Capital on operational improvements

Investing.com - RBC Capital upgraded CSX (NASDAQ:CSX) from Sector Perform to Outperform on Thursday, while raising its price target to $39.00 from $37.00. The stock, currently trading at $32.77, has shown relatively low volatility and maintains a consensus analyst target range of $27-$44, according to InvestingPro data.

The upgrade reflects RBC’s view that CSX is "well-positioned regardless of what happens with the UNP/NSC merger," according to the research note.

RBC highlighted that CSX’s operations have "improved meaningfully in recent months" despite ongoing construction projects that are currently constraining its network.

The firm specifically mentioned the Howard Street Tunnel and Blue Ridge projects as temporary constraints that are expected to "further improve fluidity when complete over the coming months."

RBC increased its target multiple for CSX to 20x from 19x, citing an "attractive scenario analysis" as the basis for the new $39 price target.

In other recent news, UBS has reiterated its Buy rating on CSX with a price target set at $41. This follows a decline in CSX’s stock since August, attributed in part to Berkshire Hathaway’s disinterest in railroad acquisitions. Meanwhile, Jefferies has also maintained a Buy rating on CSX, though it has lowered its price target from $40 to $38. The reduction reflects the removal of a takeover premium previously priced into the shares. Additionally, CSX executives, including President and CEO Joe Hinrichs, are set to address J.P. Morgan’s U.S. All Stars Conference in London, with the presentation available via webcast. Hinrichs will also speak at Morgan Stanley’s 13th Annual Laguna Conference in California, further engaging with investors. In a broader industry development, the Trump administration has fired Surface Transportation Board member Robert Primus, citing a lack of alignment with the President’s agenda.

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