Performance Comparison: CSX And Competitors In Road & Rail Industry

In the ever-evolving and intensely competitive business landscape, conducting a thorough company analysis is of utmost importance for investors and industry followers. In this article, we will carry out an in-depth industry comparison, assessing CSX CSX alongside its primary competitors in the Road & Rail industry. By meticulously examining key financial metrics, market positioning, and growth prospects, we aim to offer valuable insights to investors and shed light on company's performance within the industry.

CSX Background

Operating in the Eastern United States, Class I railroad CSX generated revenue near $14.8 billion in 2022. On its more than 21,000 miles of track, CSX hauls shipments of coal (16% of consolidated revenue), chemicals (17%), intermodal containers (16%), automotive cargo (7%), and a diverse mix of other bulk and industrial merchandise.

After thoroughly examining CSX, the following trends can be inferred:

• With a Price to Earnings ratio of 15.86, which is 0.84x less than the industry average, the stock shows potential for growth at a reasonable price, making it an interesting consideration for market participants.

• Considering a Price to Book ratio of 5.14, which is well below the industry average by 0.76x, the stock may be undervalued based on its book value compared to its peers.

• With a relatively low Price to Sales ratio of 4.33, which is 0.96x the industry average, the stock might be considered undervalued based on sales performance.

• With a Return on Equity (ROE) of 8.1% that is 0.58% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.

• With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $1.92 Billion, which is 1.01x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.

• With lower gross profit of $1.47 Billion, which indicates 0.8x below the industry average, the company may experience lower revenue after accounting for production costs.

• The company's revenue growth of -3.04% exceeds the industry average of -6.6%, indicating strong sales performance and market outperformance.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio measures the financial leverage of a company by evaluating its debt relative to its equity.

Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.

By considering the Debt-to-Equity ratio, CSX can be compared to its top 4 peers, leading to the following observations:

• When compared to its top 4 peers, CSX has a moderate debt-to-equity ratio of 1.5.

• This implies that the company maintains a balanced financial structure with a reasonable level of debt and an appropriate reliance on equity financing.

Key Takeaways

CSX has a low PE ratio, indicating that its stock price is relatively low compared to its earnings. The low PB ratio suggests that the stock is undervalued based on its book value. The low PS ratio indicates that the stock is trading at a lower price relative to its sales. On the other hand, CSX has a high ROE, indicating efficient use of shareholders' equity. The high EBITDA suggests strong operational profitability. The low gross profit may indicate potential cost management issues. Lastly, the high revenue growth indicates a positive trend in the company's sales.

This article was generated by Benzinga's automated content engine and reviewed by an editor.