After New High, Will CSX Be Stopped in its Tracks?

© Reuters.

By Charley Blaine – On Monday and Tuesday, railroad giant CSX’s shares hit 52-week highs. On Wednesday, the shares fell back and are falling again on Thursday.

The question is whether CSX (NASDAQ:) is peaking. That 52-week high on Tuesday was immediately followed by a pullback and the shares ended the day down 0.7%. They’re off another 1.9% since. And three days of declines will tell a chart-watching investor that maybe a trend has been established.

The consensus price target for CSX, according to analysts polled by, is $76, which doesn’t suggest there’s much upside.’s technical indicators rate the stock a sell.

To be sure, CSX has had a big run since the end of 2017, rising nearly 43%. The stock rebounded 20.4% in the first quarter after slumping (like just about everyone else) in the fourth quarter.

And they weren’t alone in the sector. The largest railroad companies in the United States and Canada all sported healthy first-quarter gains and, like CSX, were having big years in 2018 until that awful fourth-quarter slump set in. The fell 20% from the end of September though the end of the year. CSX fell 16.1%.

Railroad stocks have been rising as they start to make major moves to streamline their operations and boost their financial performance. The idea is not to let rail cars sit idle in big yards until all the cars going from, say, Nashville to Detroit, are in the same place.

The trick is to start building the train to Detroit as soon as possible when the cars first arrive from various places so that the departure can happen earlier. In the long run, it means fewer locomotives and fewer cars, lower costs and higher profits and earnings per share.

The idea is

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