CSX’s Q3 2016 Earnings Preview: Weakness In Shipment Volumes And Fuel Surcharge Revenue To Weigh On Results

-5.32%
Downside
37.07
Market
35.10
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We expect top line pressure as a result of weaker shipments and fuel surcharge revenue to adversely impact CSX’s Q3 2016 revenue and profits. A decline in shipments, led by a decline in the shipments of coal and petroleum-related products, will adversely impact the company’s Q3 revenue. A decline in the demand for coal from utilities, as a result of soft natural gas prices, has translated into a decline in CSX’s coal shipments. In addition, a decline in drilling activity amid subdued oil prices has negatively impacted the company’s petroleum-related shipments. Moreover, lower fuel prices are likely to adversely impact CSX’s fuel surcharge revenue. Though lower fuel-related expenses will partially offset the impact of top line headwinds on CSX’s profits, we expect the company to report a year-over-year decline in its EPS.

CSX Q3 2016 Pre-Earnings 1

CSX Q3 2016 Pre-Earnings 3

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Have more questions about CSX? See the links below.

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for CSX

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