NORFOLK SOUTHERN CORP (NSC) Stock Fundamental Analysis
USA - NYSE:NSC - US6558441084 - Common Stock
283.98 USD
+0.45 (+0.16%)
283.98 USD
0 (0%)
NSC gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 43 industry peers in the Ground Transportation industry. While NSC belongs to the best of the industry regarding profitability, there are concerns on its financial health. NSC is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
NSC had positive earnings in the past year.
NSC had a positive operating cash flow in the past year.
NSC had positive earnings in each of the past 5 years.
Each year in the past 5 years NSC had a positive operating cash flow.
1.2 Ratios
NSC has a better Return On Assets (6.64%) than 76.74% of its industry peers.
Looking at the Return On Equity, with a value of 19.54%, NSC belongs to the top of the industry, outperforming 83.72% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 8.30%, NSC is in the better half of the industry, outperforming 76.74% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for NSC is above the industry average of 7.13%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.64% | ||
| ROE | 19.54% | ||
| ROIC | 8.3% |
ROA(3y)6.26%
ROA(5y)6.38%
ROE(3y)19.41%
ROE(5y)18.77%
ROIC(3y)9.15%
ROIC(5y)8.93%
1.3 Margins
With an excellent Profit Margin value of 24.19%, NSC belongs to the best of the industry, outperforming 88.37% of the companies in the same industry.
In the last couple of years the Profit Margin of NSC has declined.
NSC has a better Operating Margin (35.39%) than 93.02% of its industry peers.
In the last couple of years the Operating Margin of NSC has remained more or less at the same level.
Looking at the Gross Margin, with a value of 50.03%, NSC is in the better half of the industry, outperforming 62.79% of the companies in the same industry.
NSC's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 35.39% | ||
| PM (TTM) | 24.19% | ||
| GM | 50.03% |
OM growth 3Y-1.82%
OM growth 5Y1.35%
PM growth 3Y-7.11%
PM growth 5Y-2.12%
GM growth 3Y-0.74%
GM growth 5Y1.7%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), NSC is creating some value.
NSC has more shares outstanding than it did 1 year ago.
The number of shares outstanding for NSC has been reduced compared to 5 years ago.
The debt/assets ratio for NSC has been reduced compared to a year ago.
2.2 Solvency
NSC has an Altman-Z score of 2.40. This is not the best score and indicates that NSC is in the grey zone with still only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.40, NSC perfoms like the industry average, outperforming 55.81% of the companies in the same industry.
NSC has a debt to FCF ratio of 8.14. This is a slightly negative value and a sign of low solvency as NSC would need 8.14 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 8.14, NSC is doing good in the industry, outperforming 72.09% of the companies in the same industry.
A Debt/Equity ratio of 1.09 is on the high side and indicates that NSC has dependencies on debt financing.
NSC has a worse Debt to Equity ratio (1.09) than 74.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 8.14 | ||
| Altman-Z | 2.4 |
ROIC/WACC0.91
WACC9.08%
2.3 Liquidity
A Current Ratio of 0.86 indicates that NSC may have some problems paying its short term obligations.
NSC has a worse Current ratio (0.86) than 69.77% of its industry peers.
NSC has a Quick Ratio of 0.86. This is a bad value and indicates that NSC is not financially healthy enough and could expect problems in meeting its short term obligations.
NSC has a worse Quick ratio (0.78) than 72.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.78 |
3. Growth
3.1 Past
NSC shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.93%.
Measured over the past 5 years, NSC shows a small growth in Earnings Per Share. The EPS has been growing by 2.93% on average per year.
NSC shows a small growth in Revenue. In the last year, the Revenue has grown by 0.48%.
NSC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.42% yearly.
EPS 1Y (TTM)5.93%
EPS 3Y-0.78%
EPS 5Y2.93%
EPS Q2Q%1.54%
Revenue 1Y (TTM)0.48%
Revenue growth 3Y2.85%
Revenue growth 5Y1.42%
Sales Q2Q%1.7%
3.2 Future
The Earnings Per Share is expected to grow by 8.55% on average over the next years. This is quite good.
NSC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.96% yearly.
EPS Next Y3.94%
EPS Next 2Y6.01%
EPS Next 3Y7.6%
EPS Next 5Y8.55%
Revenue Next Year1.03%
Revenue Next 2Y2.14%
Revenue Next 3Y2.87%
Revenue Next 5Y3.96%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 23.05, which indicates a rather expensive current valuation of NSC.
Compared to the rest of the industry, the Price/Earnings ratio of NSC indicates a somewhat cheap valuation: NSC is cheaper than 69.77% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of NSC to the average of the S&P500 Index (25.89), we can say NSC is valued inline with the index average.
A Price/Forward Earnings ratio of 21.34 indicates a rather expensive valuation of NSC.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NSC indicates a somewhat cheap valuation: NSC is cheaper than 62.79% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of NSC to the average of the S&P500 Index (34.59), we can say NSC is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.05 | ||
| Fwd PE | 21.34 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as NSC.
76.74% of the companies in the same industry are more expensive than NSC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.11 | ||
| EV/EBITDA | 14.91 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates NSC does not grow enough to justify the current Price/Earnings ratio.
NSC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)5.85
PEG (5Y)7.88
EPS Next 2Y6.01%
EPS Next 3Y7.6%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.90%, NSC has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.74, NSC pays a better dividend. On top of this NSC pays more dividend than 81.40% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.44, NSC is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.9% |
5.2 History
On average, the dividend of NSC grows each year by 8.41%, which is quite nice.
NSC has paid a dividend for at least 10 years, which is a reliable track record.
NSC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)8.41%
Div Incr Years0
Div Non Decr Years23
5.3 Sustainability
NSC pays out 41.16% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of NSC is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP41.16%
EPS Next 2Y6.01%
EPS Next 3Y7.6%
283.98
+0.45 (+0.16%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryGround Transportation
Earnings (Last)
Earnings (Next)
Inst Owners80.6%
Inst Owner Change2.38%
Ins Owners0.02%
Ins Owner Change2.37%
Market Cap69.49B
Revenue(TTM)12.23B
Net Income(TTM)2.96B
Analysts70
Price Target317.29 (11.73%)
Short Float %2.59%
Short Ratio3.75
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.9% |
Yearly Dividend5.4
Dividend Growth(5Y)8.41%
DP41.16%
Div Incr Years0
Div Non Decr Years23
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.55%
Min EPS beat(2)-1.39%
Max EPS beat(2)2.49%
EPS beat(4)2
Avg EPS beat(4)0.51%
Min EPS beat(4)-1.39%
Max EPS beat(4)2.49%
EPS beat(8)4
Avg EPS beat(8)0.52%
EPS beat(12)5
Avg EPS beat(12)-0.06%
EPS beat(16)7
Avg EPS beat(16)0.66%
Revenue beat(2)0
Avg Revenue beat(2)-1.4%
Min Revenue beat(2)-1.61%
Max Revenue beat(2)-1.18%
Revenue beat(4)0
Avg Revenue beat(4)-1.06%
Min Revenue beat(4)-1.61%
Max Revenue beat(4)-0.43%
Revenue beat(8)0
Avg Revenue beat(8)-1.37%
Revenue beat(12)1
Avg Revenue beat(12)-1.29%
Revenue beat(16)5
Avg Revenue beat(16)-0.53%
PT rev (1m)3.45%
PT rev (3m)5.71%
EPS NQ rev (1m)-9.38%
EPS NQ rev (3m)-11.43%
EPS NY rev (1m)-3.09%
EPS NY rev (3m)-3.46%
Revenue NQ rev (1m)-2.07%
Revenue NQ rev (3m)-2.47%
Revenue NY rev (1m)-0.62%
Revenue NY rev (3m)-0.81%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.05 | ||
| Fwd PE | 21.34 | ||
| P/S | 5.68 | ||
| P/FCF | 33.11 | ||
| P/OCF | 16.36 | ||
| P/B | 4.59 | ||
| P/tB | 4.59 | ||
| EV/EBITDA | 14.91 |
EPS(TTM)12.32
EY4.34%
EPS(NY)13.31
Fwd EY4.69%
FCF(TTM)8.58
FCFY3.02%
OCF(TTM)17.36
OCFY6.11%
SpS49.98
BVpS61.87
TBVpS61.87
PEG (NY)5.85
PEG (5Y)7.88
Graham Number130.96
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.64% | ||
| ROE | 19.54% | ||
| ROCE | 10.54% | ||
| ROIC | 8.3% | ||
| ROICexc | 8.6% | ||
| ROICexgc | 8.6% | ||
| OM | 35.39% | ||
| PM (TTM) | 24.19% | ||
| GM | 50.03% | ||
| FCFM | 17.16% |
ROA(3y)6.26%
ROA(5y)6.38%
ROE(3y)19.41%
ROE(5y)18.77%
ROIC(3y)9.15%
ROIC(5y)8.93%
ROICexc(3y)9.43%
ROICexc(5y)9.19%
ROICexgc(3y)9.43%
ROICexgc(5y)9.19%
ROCE(3y)11.62%
ROCE(5y)11.33%
ROICexgc growth 3Y-2.05%
ROICexgc growth 5Y0.88%
ROICexc growth 3Y-2.05%
ROICexc growth 5Y0.88%
OM growth 3Y-1.82%
OM growth 5Y1.35%
PM growth 3Y-7.11%
PM growth 5Y-2.12%
GM growth 3Y-0.74%
GM growth 5Y1.7%
F-Score8
Asset Turnover0.27
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 8.14 | ||
| Debt/EBITDA | 2.89 | ||
| Cap/Depr | 155.57% | ||
| Cap/Sales | 17.58% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 74.41% | ||
| Profit Quality | 70.94% | ||
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.78 | ||
| Altman-Z | 2.4 |
F-Score8
WACC9.08%
ROIC/WACC0.91
Cap/Depr(3y)212.64%
Cap/Depr(5y)178.37%
Cap/Sales(3y)22.6%
Cap/Sales(5y)19.25%
Profit Quality(3y)38.72%
Profit Quality(5y)63.1%
High Growth Momentum
Growth
EPS 1Y (TTM)5.93%
EPS 3Y-0.78%
EPS 5Y2.93%
EPS Q2Q%1.54%
EPS Next Y3.94%
EPS Next 2Y6.01%
EPS Next 3Y7.6%
EPS Next 5Y8.55%
Revenue 1Y (TTM)0.48%
Revenue growth 3Y2.85%
Revenue growth 5Y1.42%
Sales Q2Q%1.7%
Revenue Next Year1.03%
Revenue Next 2Y2.14%
Revenue Next 3Y2.87%
Revenue Next 5Y3.96%
EBIT growth 1Y-2.13%
EBIT growth 3Y0.98%
EBIT growth 5Y2.8%
EBIT Next Year40.01%
EBIT Next 3Y16.85%
EBIT Next 5Y11.09%
FCF growth 1Y83.8%
FCF growth 3Y-78.42%
FCF growth 5Y-56.86%
OCF growth 1Y28.6%
OCF growth 3Y-1.62%
OCF growth 5Y0.81%
NORFOLK SOUTHERN CORP / NSC FAQ
What is the ChartMill fundamental rating of NORFOLK SOUTHERN CORP (NSC) stock?
ChartMill assigns a fundamental rating of 5 / 10 to NSC.
What is the valuation status for NSC stock?
ChartMill assigns a valuation rating of 4 / 10 to NORFOLK SOUTHERN CORP (NSC). This can be considered as Fairly Valued.
What is the profitability of NSC stock?
NORFOLK SOUTHERN CORP (NSC) has a profitability rating of 7 / 10.
What are the PE and PB ratios of NORFOLK SOUTHERN CORP (NSC) stock?
The Price/Earnings (PE) ratio for NORFOLK SOUTHERN CORP (NSC) is 23.05 and the Price/Book (PB) ratio is 4.59.
How sustainable is the dividend of NORFOLK SOUTHERN CORP (NSC) stock?
The dividend rating of NORFOLK SOUTHERN CORP (NSC) is 7 / 10 and the dividend payout ratio is 41.16%.