Price to Operating Profit (P/OP)
since 2005
Calculation
CSX Corp., P/OP, long-term trends, calculation
| P/OP | = | Share price1, 2, 3 | ÷ | Operating profit per share1 | Operating profit per share1 | = | Operating income1 (in millions) |
÷ | No. shares of common stock outstanding2 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 15, 2023 | 10.85 | = | 31.67 | ÷ | 2.92 | 2.92 | = | 6,023 | ÷ | 2,062,605,434 | |
| Feb 16, 2022 | 13.79 | = | 35.17 | ÷ | 2.55 | 2.55 | = | 5,594 | ÷ | 2,193,389,444 | |
| Feb 10, 2021 | 15.41 | = | 29.39 | ÷ | 1.91 | 1.91 | = | 4,362 | ÷ | 2,287,515,174 | |
| Feb 12, 2020 | 12.39 | = | 26.50 | ÷ | 2.14 | 2.14 | = | 4,965 | ÷ | 2,321,476,695 | |
| Feb 6, 2019 | 11.41 | = | 22.70 | ÷ | 1.99 | 1.99 | = | 4,869 | ÷ | 2,446,891,098 | |
| Feb 7, 2018 | 12.82 | = | 17.66 | ÷ | 1.38 | 1.38 | = | 3,667 | ÷ | 2,661,708,240 | |
| Feb 14, 2017 | 13.12 | = | 16.00 | ÷ | 1.22 | 1.22 | = | 3,389 | ÷ | 2,779,340,979 | |
| Feb 10, 2016 | 6.48 | = | 8.04 | ÷ | 1.24 | 1.24 | = | 3,584 | ÷ | 2,889,450,033 | |
| Feb 11, 2015 | 9.85 | = | 11.98 | ÷ | 1.22 | 1.22 | = | 3,613 | ÷ | 2,971,694,472 | |
| Feb 12, 2014 | 7.95 | = | 9.13 | ÷ | 1.15 | 1.15 | = | 3,473 | ÷ | 3,022,775,019 | |
| Feb 19, 2013 | 6.81 | = | 7.69 | ÷ | 1.13 | 1.13 | = | 3,457 | ÷ | 3,062,389,890 | |
| Feb 21, 2012 | 6.51 | = | 7.05 | ÷ | 1.08 | 1.08 | = | 3,418 | ÷ | 3,156,803,076 | |
| Feb 18, 2011 | 9.02 | = | 8.31 | ÷ | 0.92 | 0.92 | = | 3,071 | ÷ | 3,333,365,955 | |
| Feb 19, 2010 | 7.99 | = | 5.20 | ÷ | 0.65 | 0.65 | = | 2,285 | ÷ | 3,510,318,915 | |
| Feb 19, 2009 | 3.79 | = | 2.92 | ÷ | 0.77 | 0.77 | = | 2,768 | ÷ | 3,593,287,557 | |
| Feb 22, 2008 | 8.96 | = | 5.57 | ÷ | 0.62 | 0.62 | = | 2,256 | ÷ | 3,630,269,457 | |
| Feb 15, 2007 | 8.33 | = | 4.53 | ÷ | 0.54 | 0.54 | = | 2,138 | ÷ | 3,931,135,569 | |
| Feb 24, 2006 | 7.85 | = | 3.08 | ÷ | 0.39 | 0.39 | = | 1,550 | ÷ | 3,949,764,678 |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-30), 10-K (reporting date: 2015-12-25), 10-K (reporting date: 2014-12-26), 10-K (reporting date: 2013-12-27), 10-K (reporting date: 2012-12-28), 10-K (reporting date: 2011-12-30), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-25), 10-K (reporting date: 2008-12-26), 10-K (reporting date: 2007-12-28), 10-K (reporting date: 2006-12-29), 10-K (reporting date: 2005-12-30).
1 US$
2 Data adjusted for splits and stock dividends.
3 Closing price as at the filing date of CSX Corp. Annual Report.
The analysis of the Price to Operating Profit (P/OP) ratio from 2006 to 2023 reveals a long-term expansion in valuation multiples, characterized by a period of stability, a severe short-term contraction, and a significant peak in the early 2020s.
- Operating Profit and Share Price Correlation
- A consistent upward trajectory is observed in operating profit per share, which grew from 0.39 USD in 2006 to 2.92 USD in 2023. Share prices followed a similar general trend, rising from 3.08 USD to a peak of 35.17 USD in 2022. The steady climb in operating profit indicates a sustained improvement in core fundamental performance over the seventeen-year period.
- Valuation Contraction and Recovery
- A significant anomaly occurred in 2009, where the P/OP ratio dropped sharply to 3.79. This contraction was driven by a decline in share price to 2.92 USD, despite the fact that operating profit per share actually increased to 0.77 USD. This divergence suggests a period where market sentiment decoupled from operational performance. Recovery followed, with the ratio returning to a range between 6.5 and 9.8 from 2010 through 2016.
- Multiple Expansion and Recent Correction
- The period between 2017 and 2021 was marked by a substantial expansion in the P/OP multiple, reaching a maximum of 15.41 in 2021. This indicates a period of heightened investor confidence and a willingness to pay a higher premium for the company's operating earnings. However, a subsequent correction is evident in 2022 and 2023, with the ratio declining to 10.85. This compression occurred even as operating profit per share reached its highest level in 2023, indicating a normalization of the valuation multiple.
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Comparison to Competitors
CSX Corp., P/OP, long-term trends, comparison to competitors
| CSX Corp. | FedEx Corp. | Uber Technologies Inc. | Union Pacific Corp. | United Airlines Holdings Inc. | United Parcel Service Inc. | |
|---|---|---|---|---|---|---|
| Feb 15, 2023 | 10.85 | 9.07 | — | 12.68 | 6.86 | 11.70 |
| Feb 16, 2022 | 13.79 | 13.46 | — | 16.53 | — | 14.20 |
| Feb 10, 2021 | 15.41 | 17.79 | — | 17.46 | — | 18.23 |
| Feb 12, 2020 | 12.39 | 9.92 | — | 14.83 | 4.07 | 11.72 |
| Feb 6, 2019 | 11.41 | 12.57 | — | 13.73 | 7.11 | 13.69 |
| Feb 7, 2018 | 12.82 | 11.48 | — | 12.30 | 5.43 | 11.98 |
| Feb 14, 2017 | 13.12 | 13.87 | — | 12.14 | 5.41 | 17.14 |
| Feb 10, 2016 | 6.48 | 25.90 | — | 7.89 | 3.61 | 11.27 |
| Feb 11, 2015 | 9.85 | 12.51 | — | 12.26 | 11.01 | 18.48 |
| Feb 12, 2014 | 7.95 | 12.87 | — | 10.81 | 13.59 | 12.57 |
| Feb 19, 2013 | 6.81 | 9.13 | — | 9.26 | 224.23 | 58.68 |
| Feb 21, 2012 | 6.51 | 12.54 | — | 9.74 | 3.82 | 12.11 |
| Feb 18, 2011 | 9.02 | 12.16 | — | 9.29 | 8.23 | 12.40 |
| Feb 19, 2010 | 7.99 | 23.98 | — | 9.25 | — | 15.34 |
| Feb 19, 2009 | 3.79 | 11.54 | — | 6.09 | — | 7.62 |
| Feb 22, 2008 | 8.96 | 11.05 | — | 9.75 | 3.48 | 125.70 |
| Feb 15, 2007 | 8.33 | 11.08 | — | 9.75 | 9.70 | 11.27 |
| Feb 24, 2006 | 7.85 | 10.21 | — | 13.19 | — | 13.88 |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-30), 10-K (reporting date: 2015-12-25), 10-K (reporting date: 2014-12-26), 10-K (reporting date: 2013-12-27), 10-K (reporting date: 2012-12-28), 10-K (reporting date: 2011-12-30), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-25), 10-K (reporting date: 2008-12-26), 10-K (reporting date: 2007-12-28), 10-K (reporting date: 2006-12-29), 10-K (reporting date: 2005-12-30).