Despite Wall Street Woes, CSX on Track

Tuesday, 23 Sep 2008 | 6:42 PM ET

We’ve all heard of a “yes man.” But what about a “no man.”

That’s exactly what CSX CEO Michael Ward was during his interview with Cramer on Tuesday’s Mad Money. Here’s a sample:

Cramer: Is the Wall Street dilemma slamming headlong into your business on Main Street?

Ward: No.

Cramer: What about the stronger dollar? Is it hurting your export business?

Ward: No

Cramer: You’ve been re-pricing your contracts. Have those been weak?

Ward: No.

On The Right Track?
Discussing the economy, with Michael Ward, CSX Corp. president, chairman & CEO and Mad Money host Jim Cramer.

With coal prices spiking worldwide due to lack of supply, and fertilizers, ethanol and metals are all still strong, the rails transportation business is a good one right now, Ward said. And that worldwide demand is offsetting any modest move in the dollar. Sure, there are weaker segments – think autos and housing – but CSX’s portfolio is diversified, providing cushion where necessary.

Oddly, though, CSX’s stock is down even though the company just raised its guidance. The operating-income-growth rate was bumped up to 15% to 20% a year from 13% to 15%. Earnings-per-share growth is expected to climb 20% to 25% rather than 18% to 21%. Pricing, and this is where those contracts come in, is expected to be up 6% year over year.

If anything, consider the pullback in CSX a great buying opportunity.

“Rails, still a place to be,” Cramer said. “Amazing, given the fact that everything else is so weak.”

Questions for Cramer? madmoney@cnbc.com

Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com

  Price   Change %Change

Contact Mad Money

  • Showtimes

    Monday - Friday 6p ET
  • Jim Cramer is host of CNBC's "Mad Money" and co-anchor of the 9 a.m. ET hour of CNBC's "Squawk on the Street."

Mad Money Features

  • Grab the latest CNBC gear from the NBCUniversal Store!

  • Get a behind-the-scenes look at how Cramer formulates his investment advice. "Inside the Madness" is a column, which features e-mails and more with Cramer and his researcher Nicole Urken.

  • You’ve always wanted to hit the “Hallelujah!” button. Here’s your chance.