Transportation is undergoing some fundamental shifts because of climate change and sustainability. The Paris Climate Agreement of 2015 has placed tremendous emphasis on reducing carbon emissions. Since the transport sector is one of the major emitters of greenhouse gases, government policies are intended to make transportation more “green”. In such a scenario, rail transport could benefit because it is less carbon-intensive than traditional modes of transportation like road transport. Road transportation is indeed going a shift with the arrival of electric vehicles. However, a more readily available solution in the near term could be rail transport. Companies like CSX Corporation are among the best transportation stocks to buy now.
CSX Corporation Reports Q42020 Earnings
On 21st January 2021, CSX Corporation reported its fourth-quarter 2020 earnings results. Revenue was almost flat at $2.82 billion, slightly down from $2.88 billion in Q42019. Operating income rose from $1.15 billion in Q42019 to $1.21 billion. Earnings per share remained steady at $0.99, the same level on a year-on-year basis. Fuel efficiency was down from 0.99 gallons per kGTM in Q42019 to 0.94 gallons per kGTM. Train velocity was also down from 21.3 mph in Q42019 to 18.9 mph in Q42020. Coal revenues for CSX were down 18%, mainly due to lower demand from domestic utilities and industrial production facilities. On the sustainability front, CSX managed to avoid 10 million metric tons of CO2 emissions, which is significant because it is the equivalent of emissions attributed to powering all buildings in New York City for an entire year. As a result, CSX is one of the top transportation stocks to buy now.
CSX Corporation’s stock closed at $98.64 on 16th April 2021. The stock has been up 8.67% over the preceding 30 days and has gained 61% over the prior year. It is clearly in an uptrend. On 16th April, the stock was trading at a dividend yield of 1.14% at the close of the day. Investors may want to consider CSX if transportation is an area of interest.