CSX: Margin Expansion and Network Catalysts Support Buy Rating Amid Muted Revenue Outlook

Analyst Jason Seidl of TD Cowen maintained a Buy rating on CSX, retaining the price target of $40.00.

Jason Seidl has given his Buy rating due to a combination of factors that, in his view, support CSX’s ability to grow earnings despite a muted revenue outlook. While 4Q revenue came in slightly below his forecast, profitability metrics such as the operating ratio were marginally better, and adjusted EPS matched expectations. Management’s 2026 guidance calls for only low single‑digit sales growth amid ongoing weakness in key industrial segments like housing, autos and chemicals, but Seidl highlights CSX’s focus on productivity and cost efficiency as a key lever to expand margins even in this soft demand environment. He also points to the company’s substantial share repurchase activity as a signal of confidence in cash generation and an incremental support to EPS growth.

Seidl further underscores several volume and network catalysts that he believes underpin the constructive stance. Intermodal showed healthy growth in the quarter, driven by newly won business that should continue to contribute in 2026, and the upcoming activation of the Howard Street double‑stack corridor is expected to add longer‑term upside as customers gradually ramp usage. In coal, strong domestic utility demand and the lapping of temporary mine closures could set up a favorable near‑term volume profile, with risks from scheduled 2026 closures potentially deferred. Although export coal benchmarks remain weak and the broader industrial economy lacks major catalysts, Seidl judges that CSX’s operational improvements, targeted growth initiatives, and supportive capital return strategy collectively justify maintaining his $40 price target and a Buy recommendation.

In another report released today, Barclays also maintained a Buy rating on the stock with a $40.00 price target.

Based on the recent corporate insider activity of 60 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of CSX in relation to earlier this year.