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CSX Gears Up to Report Q1 Earnings: What's in the Cards?

CSX Corporation CSX is scheduled to report first-quarter 2023 results on Apr 20, after market close.

The stock has an impressive earnings surprise history, having outperformed the Zacks Consensus Estimate in each of the preceding four quarters, the average beat being 4.85%. The consensus estimate for first-quarter earnings has declined marginally to 43 cents per share over the past 90 days.

Given this backdrop, let’s examine the factors that are likely to have influenced CSX’s performance in the quarter to be reported.

We expect coal revenues to have been impressive primarily due to high export-coal prices. The Zacks Consensus Estimate for the metric indicates a 1% increase from the fourth-quarter 2022 actual. High fuel surcharge revenues are likely to have aided the top line.

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On the flip side, supply-chain disruptions, including labor and equipment shortages, are expected to have hurt CSX’s first-quarter performance. Rising fuel expenses are expected to have continued to affect the bottom line. Our estimate for fuel expenses indicates a 18.3% rise from the first-quarter 2022 actuals.

The operating ratio (operating expenses as a percentage of revenues) is likely to have suffered in the to-be-reported quarter due to high costs.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for CSX this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

CSX has an Earnings ESP of -1.67% and a Zacks Rank #3.

Q4 Highlights

The company's fourth-quarter 2022 earnings of 49 cents per share beat the Zacks Consensus Estimate of 47 cents and improved 16.67% year over year.

Total revenues increased 8.84% year over year to $3,730 million and surpassed the Zacks Consensus Estimate of $3,722.1 million. Higher fuel surcharge, pricing gains, and an increase in volumes, storage and other revenues acted as tailwinds. Overall revenues per unit increased 11%.

Stocks to Consider

Here are a few stocks from the broader Zacks Transportation sector that investors may consider, as our model shows that these have the right combination of elements to beat on earnings this season.

Canadian National Railway Company CNI has an Earnings ESP of +1.67% and a Zacks Rank #3. It will release first-quarter 2023 results on Apr 24. You can see the complete list of today’s Zacks #1 Rank stocks here.

The stock delivered a trailing four-quarter earnings surprise of 3.5%, on average. The Zacks Consensus Estimate for CNI’s first-quarter 2023 earnings has increased 18.3% from the first-quarter 2022 actuals.

Kirby Corporation KEX has an Earnings ESP of +0.52% and carries a Zacks Rank #3. It will release first-quarter 2023 results on Apr 27.

The company delivered a trailing four-quarter earnings surprise of 3.8%, on average. The Zacks Consensus Estimate for KEX’s first-quarter 2023 earnings has surged more than 100% from the first-quarter 2022 actuals.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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CSX Corporation (CSX) : Free Stock Analysis Report

Canadian National Railway Company (CNI) : Free Stock Analysis Report

Kirby Corporation (KEX) : Free Stock Analysis Report

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Zacks Investment Research