Why CSX Is Poised to Keep Chuggin'

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, railroad operator CSX (NYSE: CSX  ) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at CSX and see what CAPS investors are saying about the stock right now.

CSX facts

Headquarters (founded)

Jacksonville, Fla. (1978)

Market Cap

$24.9 billion

Industry

Railroads

Trailing-12-Month Revenue

$11.8 billion

Management

Chairman/CEO Michael Ward

CFO Fredrik Eliasson

Return on Equity (average, past 3 years)

20.4%

Cash/Debt

$1.1 billion / $9.4 billion

Dividend Yield

2.5%

Competitors

Norfolk Southern

Union Pacific

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 97% of the 2,121 members who have rated CSX believe the stock will outperform the S&P 500 going forward.

Just last week, one of those Fools, All-Star BoiseKen, tapped CSX as a particularly solid opportunity:

CSX is depressed vs. Canadian National Railway & [Union Pacific] (two other companies I gave the green thumb to). ... I think the problem is that CSX is being sold because of a SHORT-TERM issue related to the price between coal & natural gas. This problem is likely to resolve in the long-run because 1) NG prices may rise and demand continues to rise. 2) Not all utilities can switch to NG -- coal demand will flatten. 3) Crude oil by rail could fill in some of the softness from coal.

In the long run, CSX is a winner -- the P/E will rise toward to peers and get a little extra dividend yield while I wait.

If you want market-thumping returns, you need to put together the best portfolio you can. Of course, despite a strong five-star rating, CSX may not be your top choice.

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