(The Associated Press circulated the following story on April 19.)
NEW YORK — Shares of railroad operators traded higher on Wednesday, as investors gained confidence from news that pricing appears to have remained strong for companies during the first quarter despite clearly weaker freight demand.
Shares of CSX Corp. rose $1.62, or 3.7 percent, to $44.95 in midday trading. Shares of Union Pacific Corp. added $3.26, or 3 percent, to $113.72. Shares of Norfolk Southern Corp. jumped $1.39, or 2.6 percent to $55.43. All the stocks trade on the New York Stock Exchange.
CSX said Tuesday after the markets closed that its first-quarter earnings fell 2 percent to $240 million, or 52 cents per share, from $245 million, or 53 cents per share, during the same period last year. The results included a gain of 2 cents per share related insurance recoveries. Analysts polled by Thomson Financial forecast a profit of 53 cents per share. Its estimates usually exclude special items.
But investors ignored the miss after CSX said continued strong pricing drove revenue up 4 percent to $2.4 billion, although freight volumes fell 4 percent.
“Pricing has remained firm which we believe is a strong positive for all the rails,” said Edward Wolfe, an analyst at Bear Stearns, in a note to clients on Wednesday.
Investor will learn more on Thursday when Union Pacific, the nation’s largest railroad, releases its quarterly results. Burlington Northern Santa Fe Corp., which gained 86 cents to $92.54 on the NYSE, reports on Tuesday. Norfolk Southern follows on Wednesday.
Elsewhere in the sector, Canadian National Railway Co. added 78 cents to $49.56, while Canadian Pacific Railway Ltd. rose 64 cents to $60.75. Both names trade on the NYSE.