Railway Takeaways From Citi Industrials Conference

The 2016 Citi Industrials Conference took place this week, and analyst Christian Wetherbee released a series of new notes with takeaways from the conference and commentary on a number of railway stocks. Here’s a look at what he had to say.

Kansas City Southern (NYSE: KSU): Wetherbee saw CFO Michael Upchurch’s presentation as positive, and Citi’s “long-term thesis remains unchanged, with line of sight to volume improvement in 2H16.” The firm maintains a Buy rating and $108 price target.

CSX Corporation (NASDAQ: CSX): CFO Frank Lonegro presented at the conference, and Citi feels “investment in its intermodal franchise to balance secular coal declines remains the foundation for longer-term portfolio growth.” The firm maintains a Buy rating and $29 price target.

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Norfolk Southern Corp. (NYSE: NSC): CFO Marta Stewart spoke positively at the conference, but Wetherbee remains “comfortable with our below consensus 2Q EPS estimate.” Citi maintains a Neutral rating and $87 price target.

Canadian Pacific Railway Limited (USA) (NYSE: CP): President and COO Keith Creel spoke at the conference, and Citi sees the company as “well positioned, as it solidifies its operations in this downturn, to take advantage of any market improvement.” The firm maintains a Buy rating and a $170 price target.

Canadian National Railway (USA) (NYSE: CNI): Soon-to-be CEO Luc Lobin presented at the conference. Despite a 4-5 percent decrease in 2016 volumes, “comparisons ease in the back half of the year.” Citi maintains as Neutral rating and a $62 price target.

Disclosure: The author holds no position in the stocks mentioned.

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