DCF Studio

    CSX · NMS · Industrials

    CSX Corporation

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 27.44

    Market price

    USD 51.62

    Implied upside

    -46.8%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    AdjustedCapital expenditure runs at 16.9% of revenue against depreciation of 11.1%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Value Per Share

    Perpetuity growth
    USD 27.44-46.8%
    Exit multiple
    USD 51.80+0.4%
    Market price
    USD 51.62

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn3bn5bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 15.4bnUSD 16.3bnUSD 17.1bnUSD 17.9bnUSD 18.7bnUSD 19.5bnUSD 20.2bnUSD 20.9bnUSD 21.5bnUSD 22.0bn+4.0%
    EBITUSD 5.7bnUSD 6.0bnUSD 6.3bnUSD 6.6bnUSD 6.9bnUSD 7.2bnUSD 7.4bnUSD 7.7bnUSD 7.9bnUSD 8.1bn+4.0%
    NOPATUSD 4.5bnUSD 4.7bnUSD 5.0bnUSD 5.2bnUSD 5.5bnUSD 5.7bnUSD 5.9bnUSD 6.1bnUSD 6.2bnUSD 6.4bn+4.0%
    Add depreciation & amortisationUSD 1.7bnUSD 1.8bnUSD 1.9bnUSD 2.0bnUSD 2.1bnUSD 2.2bnUSD 2.2bnUSD 2.3bnUSD 2.4bnUSD 2.4bn+4.0%
    Less capital expenditureUSD -2.6bnUSD -2.7bnUSD -2.9bnUSD -3.0bnUSD -3.1bnUSD -3.2bnUSD -3.3bnUSD -3.4bnUSD -3.5bnUSD -3.6bn+3.6%
    Capex, % of revenue16.9%16.8%16.8%16.7%16.6%16.6%16.5%16.4%16.4%16.3%-
    Less increase in working capitalUSD -22.1mUSD -14.4mUSD -14.1mUSD -13.8mUSD -13.3mUSD -12.7mUSD -11.9mUSD -11.1mUSD -10.1mUSD -9.0m-9.5%
    Free cashflow to firmUSD 3.6bnUSD 3.8bnUSD 4.0bnUSD 4.2bnUSD 4.4bnUSD 4.6bnUSD 4.8bnUSD 5.0bnUSD 5.1bnUSD 5.3bn+4.4%
    Discount factor0.95960.88380.81390.74950.69020.63570.58540.53910.49650.4572-
    Present valueUSD 3.4bnUSD 3.3bnUSD 3.3bnUSD 3.2bnUSD 3.0bnUSD 2.9bnUSD 2.8bnUSD 2.7bnUSD 2.5bnUSD 2.4bn-
    Present Value Of The ForecastUSD 29.5bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.072Reported 1.108, pulled toward 1.0 (Blume)
    Cost of equity9.43%Risk-free + beta x equity risk premium
    Cost of debt5.59%Risk-free + 70bp, the spread for a A+ rating at 5.6x interest cover. Book interest / average debt was lower, at 4.4%.
    Market capitalisationUSD 95.6bn83.2% of capital
    Total debtUSD 19.4bn16.8% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC8.59%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 27.44

    58% of EV

    Forecast FCFF, final year
    USD 5.3bn
    Capex at depreciation, working capital in reinvestment
    USD 6.4bn
    Less reinvestment at g/ROIC (17.8% of NOPAT)
    USD -1.1bn
    Capitalised
    USD 5.3bn
    ROIC (reported)
    14.0%
    Terminal value, undiscounted
    USD 88.6bn
    Terminal value, discounted
    USD 40.5bn
    Enterprise value
    USD 70.1bn
    Less net debt
    USD 18.7bn
    Equity value
    USD 51.4bn

    Exit at 17.9x EBITDA

    Value per shareUSD 51.80

    74% of EV

    Terminal value, undiscounted
    USD 188.4bn
    Terminal value, discounted
    USD 86.2bn
    Enterprise value
    USD 115.7bn
    Less net debt
    USD 18.7bn
    Equity value
    USD 97.0bn

    Spread between methods: 61%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.59%41.2243.1945.7149.0153.48
    7.59%32.6133.5734.7736.3038.27
    8.59%26.4426.8827.4428.1429.04
    9.59%21.8121.9722.1822.4622.83
    10.59%18.2118.2018.2218.2818.37

    Outlined: this model. Green text: above today's price of 51.62. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year-1.7%4.6%10.6%
    EBIT margin39.0%36.8%59.4%
    Discount rate-8.6%6.2%
    Download as Excel

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    Yahoo Finance and RBA data. General information, not advice. Methodology.