CSX US S&P 500NASDAQ-100Russell 1000 Earnings call · transcribed from the recording
CSX Corporation (CSX) · Q3 2026 results and valuation
Share price: $51.90 · 2026-11-11
CSX Corporation provides rail-based freight transportation services, including the transport of intermodal containers, bulk commodities, and automotive products. The company operates a rail network in the eastern United States and serves customers such as manufacturers, industrial producers, and agricultural companies. Source: 10-K annual report (2026-02-12)
Results Q3 2026 vs Q2 2026 · previous quarter · published 21 Oct 2026 and 22 Jul 2026
Net income up 5.0% on the previous quarter. Management sounded upbeat, in its script and in answers to analysts.
1 · Numbers
+5.0%
Net income vs Q2 2026
Outlook given
Net income 1.05B vs 1.00B
Revenue +2.1%
Why Against the same quarter last year (+51.6%), net income rose mainly because higher revenue from fuel surcharges, volume growth, and pricing gains, combined with lower non-fuel costs and improved productivity, drove a 25% increase in operating income and 420 basis points of margin expansion.
2 · How management spoke
Upbeat
More upbeat than 80% of company calls
Answers to analysts: upbeat, in line with the script.
Last call it was different: the answers were more upbeat than the script.
3 · What stood out
CSX's total intermodal volume rose 7% year-over-year to a record high, while intermodal revenue increased 20% and RPU grew 13%.
Valuation
Is CSX Corporation undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At −1.7% growth a year (3-year revenue growth), the model's fair value is $1.31 a share — the stock trades 3850% above it. Today's price assumes 23.8% growth a year.
Current price
$51.90
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+23.8% for 10 yrs
Fair value / share
$1.31
Buy below
$0.99
Price vs fair value
Overvalued >200%
Price vs buy-below price
Overvalued >200%
Read between the lines
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Figure
Revenue increased 12 percent due to higher fuel surcharges, 5 percent volume growth, and pricing gains across the merchandise, intermodal, and coal markets.
Source quote
“Revenue increased 12 percent, driven by higher fuel surcharge, 5 percent volume growth, and pricing gains across the merchandise, intermodal and coal markets.”
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Figure
Higher revenue and lower non-fuel costs drove a 25% increase in operating income and 420 basis points of margin expansion, despite 70 basis points of fuel price headwinds.
Source quote
“Adjusting for that charge, higher revenue and lower non-fuel costs drove a 25% increase in operating income and 420 basis points of margin expansion, despite 70 basis points of fuel price headwinds.”
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Guidance
CSX expects to deliver year-over-year margin improvement above 350 basis points in the fourth quarter despite potential near-term noise from fuel volatility.
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Figure
Total intermodal volume rose 7% year-over-year to a record high, while revenue increased 20% and RPU grew 13%.
Source quote
“Total intermodal volume was up 7% year-over-year and reached a new all-time record, with revenue up 20% and RPU up 13%.”
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Figure
Earnings of 57 cents per share increased 30% compared to last year's adjusted results.
3 more
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Guidance
CSX updated its revenue growth forecast from a mid to high single digit range to high single digits.
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Key theme
CSX expects same-store sales pricing to be stronger than it was last year for the current year.
Source quote
“We still expect for this year our same-store sales pricing to be stronger than it was last year.”
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Key theme
Quarter fuel efficiency reached the best ever achieved by CSX and the best ever reported by any U.S. railroad.
Source quote
“Third quarter fuel efficiency was not only the best ever achieved by CSX, but also the best ever reported by any U.S. railroad.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q3 2026. Ring: Q2 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“Lastly, coal revenue increased by 10%, driven by a 2% increase in volume and a 7% increase in RPU.”
“Revenue increased 12 percent, driven by higher fuel surcharge, 5 percent volume growth, and pricing gains across the merchandise, intermodal and coal markets.”
“Together, we have made great progress towards our goal of being best in class as we build a high-performance culture that embraces continuous improvement.”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-09-30)
| Metric | Q3 2026period end 2026-09-30 | Q2 2026period end 2026-06-30 | Change | Q3 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 4.02B | 3.94B | +2.1% | 3.59B | +12.0% |
| Operating income | 1.57B | 1.51B | +4.2% | 1.09B | +44.4% |
| Net income | 1.05B | 1.00B | +5.0% | 694.0M | +51.6% |
| EPS | 0.57 | 0.54 | +5.6% | 0.37 | +54.1% |
| P/E today 25.6 | 24.2 | 27.5 | −3.3 | 22.9 | +1.3 |
Topics
Most discussed now
- Labor expense increased by $19 million as improved workforce productivity and lapping up severance costs mostly offset over $90 million...
- Quarter, the CSX team improved safety, met increased demand for CSX's customers, delivered substantial cost efficiency, and made sequential…
- CSX's commercial group continues to deliver in a favorable environment of solid customer demand and tight trucking capacity.
- CSX has customers that are existing customers today that are continuing to look to rail to move more of their...
- CSX has seen momentum build on Howard Street, but it is excited about getting into next year's bid season, which is...
Faded since Q2 2026
- Dropped The current outlook for North American light vehicle production is still to be down just under 2% for the year.
- Dropped That's the incremental margins I'm quite pleased with, if you do that math.
- Fading These results reflect continued partnership across the business to improve safety and drive cost efficiencies while meeting increased…
- Fading I'd say, in particularly over the course of the last couple months with regulatory enforcement, I'd say on the Intermodal...
Latest announcements
Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.
- Results of operations · SEC 8-K
CSX Corp. reported third-quarter 2026 revenue of $4.02 billion, up 12% year-over-year, and diluted EPS of $0.57, up 54% compared to the previous year.
- Director or officer change; Regulation FD disclosure · SEC 8-K
CSX announced the retirement of Chief Operating Officer Michael A. Cory, who will provide transition services until May 8, 2027, with a base salary of $780,000.
- Results of operations · SEC 8-K
CSX Corporation issued its quarterly financial report for the period ended June 30, 2026, on July 22, 2026.
- Director or officer change; Shareholder vote results; Other events · SEC 8-K
CSX Corporation announced the departure of Stephen Fortune as Chief Digital & Technology Officer, the appointment of Steve Watkins as his successor, and the authorization of a $5 billion share repurchase program.
- Results of operations · SEC 8-K
CSX Corporation issued its quarterly financial report for the period ended March 31, 2026, on April 22, 2026.
- Results of operations · SEC 8-K
CSX Corporation issued its quarterly financial report for the period ended December 31, 2025, on January 22, 2026.
- Director or officer change; Regulation FD disclosure; Other events · SEC 8-K
CSX Corporation appointed Kevin S. Boone as Executive Vice President and Chief Financial Officer and promoted Maryclare T. Kenney to Senior Vice President and Chief Commercial Officer, effective October 29, 2025.
- New financial obligation; Other events · SEC 8-K
CSX Corporation completed a public offering of $300,000,000 of its 5.050% Notes due 2035 on October 23, 2025.
Catalyst calendar
management-stated targets — from the latest earnings call; plans, not promises.
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fourth quarter
expected normal seasonal increase in PSNO combined with typical weather-related reduction in fuel efficiency
Source quote
“Looking to the fourth quarter, on a sequential basis, we expect a normal seasonal increase in PSNO combined with typical weather-related reduction in fuel efficiency.”
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fourth quarter
expected step-up sequentially in the fourth quarter expense line as we enter the winter months
Source quote
“Overall, and consistent with past years, we would expect some step-up sequentially in the fourth quarter expense line as we enter the winter months.”
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fourth quarter
expected to deliver year-over-year margin improvement above 350 basis points
Source quote
“And while fuel volatility can create some near-term noise, we expect to deliver year-over-year margin improvement above 350 basis points in the fourth quarter.”
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First quarter 2027
headcount will be similar to current levels as these employees return to work and we build our conductor-training pipeline
Source quote
“First quarter 2027 headcount will be similar to current levels as these employees return to work and we build our conductor-training pipeline to start the year.”
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fourth quarter
sequential RPU increase from lagged effects of higher benchmarks
Source quote
“We expect another small sequential RPU increase in the fourth quarter from the lagged effects of these higher benchmarks.”