Stephens resumes coverage on US railroads, sees freight growth

Norfolk Southern

08/07/2026 13:20

** Stephens resumes coverage on U.S. railroad operators, with Union Pacific UNP.N and CSX CSX.O at "overweight" and Norfolk Southern NSC.N at "equal-weight" rating
** Brokerage says rising truckload rates could drive more freight to rail as shippers seek lower-cost transport options
     ** Adds that Union Pacific and Norfolk Southern merger review is moving forward, but approval is unlikely before the second half of 2027 despite the companies targeting a mid-2027 close
** Stephens says improving industrial demand could help merchandise volumes grow faster through 2027
** YTD, shares of UNP up ~22.4% , NSC rise ~11.8% and CSX jump ~33.8%

Companies
Rating
PT
Union Pacific
Overweight
$327
Norfolk Southern
Equal-Weight
$354
CSX
Overweight
$57

 (Reporting by Apratim Sarkar in Bengaluru)
 ((Apratim.Sarkar@thomsonreuters.com))