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CSX Corporation (CSX)
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Union Pacific Corporation (UNP)
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Canadian National Railway Company (CNR)
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Canadian Pacific Kansas City Limited (CP)
Q: Major US and CDN railroad stocks seem to do quite well except csx ,being on a constant downtrend lately , any suggestion as hold or sell ( or buy!) for a conservative dividend stock objective?
5i Research Answer:
Year-to-date, CSX has been trading fairly in line with CNR, but below UNP and CP, and this is also a similar trend on a one-year basis. CSX has a 1.6% yield, sales have been mostly flat over the past few years, but free cash flows are strong and supportive of its strong buyback policy (3.8% buyback yield) and dividend yield. It trades at a decent valuation of 17X forward earnings, and over the long-term it has performed fairly well. We would be comfortable holding here for a conservative, dividend approach.