| Stock analysts put CSX, NS and UP in 'buy' category | ||||
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Stifel Nicolaus Co. Inc. now has a “buy” rating on CSX Corp., Norfolk Southern Corp. and Union Pacific Corp., with NS and CSX representing “the best values in the space at current valuation levels,” according to a research note issued Friday. “In addition, we believe that Union Pacific is the Class I most likely to beat earnings-per-share estimates consistently going forward given the continued improvement we anticipate in the company’s operations,” Stifel Nicolaus analysts John Larkin and David Ross said. “We expect rail pricing to continue to hold up well in the non-truck competitive carload segments of the business, and the rails appear to us to be taking all practical steps to eliminate cost which could position the companies well for when the economy begins to recover.” Year-over-year rail volume declines “have been more severe in second-quarter 2009 in nearly all rail commodity groups relative to first-quarter 2009,” and coal shipments “have significantly deteriorated,” Larkin and Ross said. Meanwhile, the analysts have “hold” ratings on all of the truckload carriers under Stifel Nicolaus’ coverage, noting that second-quarter year-over-year earnings-per-share comparisons “could be significantly worse” than first-quarter figures. |
