BMO Capital Markets Reiterates Buy, $27 PT on CSX

BMO Capital Markets maintains its Outperform rating and the price target of $27 on CSX CSX reflecting the company's strong EPS for Q1 despite weakness in utility coal. BMO Capital Markets notes, "CSX reported Q1/12 EPS of $0.43, up 23% y/y, ahead of BMO Research of $0.39 and consensus of $0.38. …Utility coal related headwinds continue unabated in Q2/12 and pricing on approximately a third of the company's export coal shipments is expected to decline starting in Q2/12 consistent with the 12% to 13% decline in CSX's export coal tariffs announced in March. The strength in pricing and volumes in the non-coal segments are, however, providing an offset to coal and robust execution is delivering better than anticipated productivity gains." CSX closed at $22.44 yesterday.