Railway Operators Advance After CSX Issues Earlier-Than-Expected Q2 Beat

Railway operator CSX (CSX) is traded higher into the close after its unexpected earnings report beat on both the top and bottom lines.

SURPRISE EARNINGS REPORT: Originally slated to report after the market close, CSX released its second quarter numbers shortly before 3 pm ET to correct an erroneous tweet. The rail operator reported earnings per share of 47c on revenue of $2.71B against analyst expectations of 44c and $2.69B, respectively.

Though expenses improved by 9% as the company aligned costs to market challenges, volumes also declined 9% with impacts felt in "nearly all markets," including coal declines of more than 30%, which "more than offset" pricing gains from an improving service product. The company remarked that the strong dollar, low commodity prices, and the energy market's ongoing transition "continue to challenge financial performance and are expected to impact full-year earnings." Looking forward, CSX said it continues to expect 2016 full-year EPS to decline.

PRICE ACTION: Shares of CSX have jumped 4% to $28.11 following its earlier-than-expected results.

RAIL PEERS ADVANCE: Shares of other railway companies advanced after CSX's news, with Union Pacific (UNP) gaining 2.3%, Canadian National (CNI) adding about 1%, and Norfolk Southern (NSC) gaining 2.75%. Kansas City Southern (KSU) and Genesee & Wyoming (GWR) are up a respective 1.6% and 1.4%.