Stephens lowered its estimates and price targets for rail operators CSX (CSX), Kansas City Southern (KSU), Norfolk Southern (NSC) and Union Pacific (UNP) to reflect AAR-reported volumes and its outlook for an "ugly" earnings season for the group. However, the firm believes there is a fairly high probability more clarity for the rails will come in Q3 and encourages investors to watch the stocks carefully in the coming months for buying opportunities, since it views the rails as "very well-positioned" over the long-term. Stephens keeps its Equal Weight rating on Union Pacific and Overweight ratings on the other three stocks named above. The firm lowered its price target for CSX to $37 from $38, for Kansas City Southern to $105 from $120, for Norfolk Southern to $102 from $113 and for Union Pacific to $108 from $115.

The Brotherhood of Maintenance of Way Employes Division of the International Brotherhood of Teamsters announced that it has determined a change in leadership at Norfolk Southern Corporation is necessary. Tony Cardwell, President of BMWED-IBT, commented: "The BMWED-IBT, after more than a year of non-committal hedging on reasonable, needed changes and untenable shakiness in management at Norfolk Southern, has determined that a change in leadership is needed for the freight rail carrier and its employees. Following yesterday's earnings call and a reasonably constructive meeting with a potential new leadership team, our Brotherhood has determined that a change at the top would be the best course of action for BMWED-IBT members. For many months since East Palestine, the BMWED has not been able to get assurances from the current leadership to implement needed policy and procedural changes to prevent such tragedies from reoccurring. At this juncture, seeing no path forward, we see no reason to support the current administration at Norfolk Southern."

Reports Q1 revenue $6.03B, consensus $5.98B. "Our team delivered strong financial results in the first quarter as we navigated a challenging freight market and normal winter conditions," said Jim Vena, Union Pacific CEO. "These results build on the momentum we established as we exited 2023 and provide further proof of what's possible as we strive to be the best in safety, service, and operational excellence. This is a great start to the year, but we understand there's work to be done to achieve our goals and meet our stakeholders' expectations."

UBS analyst Thomas Wadewitz lowered the firm's price target on Norfolk Southern to $294 from $302 and keeps a Buy rating on the shares. Norfolk Southern's Q1 was in like with the pre-report, reflecting weak revenue and margin pressure, the analyst tells investors in a research note.