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CSX: Weak Intermodal Volume Lowered Its Rail Traffic

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CSX’s rail traffic declined

CSX’s (CSX) overall rail traffic fell 2.8% YoY (year-over-year) to 123,685 railcars in Week 20 from 127,288 wagons in Week 20 of 2018. Among the seven Class I railroad companies, three recorded volume declines, while four registered growth during Week 20. Union Pacific (UNP) recorded the highest fall of 4.2%, while Canadian Pacific Railway (CP) registered the highest volume gain of 2.8%.

CSX’s dismal rail traffic performance was mainly due to a drastic fall in its intermodal unit numbers. The company’s intermodal traffic fell 11% YoY. The company hauled 51,554 containers and trailers compared to 57,934 units in the same week the previous year. CSX’s container volumes fell 10.9% YoY to 49,734 units from 55.832 units. The company’s trailer traffic fell 13.4% YoY to 1,820 units from 2,102 units.

Six of the seven Class I railroad companies recorded intermodal volume declines during Week 20. Union Pacific registered the highest fall. Canadian Pacific is the only railroad company that registered YoY growth in intermodal units of 3.3%.

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Carload traffic declined

CSX’s carload traffic increased 4% YoY to 72,131 railcars, excluding intermodal units from 69,354 wagons in Week 20 of 2018. CSX’s carload traffic, excluding coal and coke, grew 3.2% YoY to 55,391 wagons from 53,691 railcars in the same week the previous year. The company’s coal and coke traffic increased 6.9% YoY to 16,740 units from 15,663 units.

CSX registered a carload traffic decline across the grain mill, farm, primary metals, pulp, paper, iron and steel, and coke commodity groups. Commodities including food, grain, chemicals, petroleum, forest, nonmetallic minerals, metallic ores, and motor vehicles and parts registered YoY traffic growth.

Six of the seven Class I railroad companies registered carload traffic growth during the week. Kansas City Southern’s (KSU) carload traffic growth of 5.8% was the highest. Union Pacific was the only company that recorded a volume decline of 2.5%.

CSX shares have returned ~24.2% YTD (year-to-date) and outperformed the gains of SPDR S&P Transportation ETF (XTN), which invests in the US transportation stocks. XTN has risen 11.7% YTD.

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