UPDATE: Seaport Global Securities Starts CSX (CSX) at Neutral
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(Updated - October 19, 2016 9:31 AM EDT)
Seaport Global Securities initiated coverage on CSX (NASDAQ: CSX) with a Neutral rating and a price target of $31. Analyst Mark A. Levin said he would wait for a pullback.
"We assume the shares trade to ~16x our 2017 EPS estimate of $1.95/share. Historically, CSX has traded at an average forward multiple of 12.9x, as high as 17.5x, and as low as 5.9x. We assume a higher-than-average target multiple for several reasons, including the likelihood of improving volumes, particularly in the higher-margin coal segment. Moreover, after several years of aggressive cost-cutting, CSX's incremental margins should be very strong as demand returns. Even so, we would wait for a pullback before initiating position," said Levin.
Shares of CSX closed at $31.02 yesterday.
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