NORFOLK SOUTHERN CORP (NSC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NSC - US6558441084 - Common Stock
294.19 USD
-0.94 (-0.32%)
294.19 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to NSC. NSC was compared to 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
In the past year NSC was profitable.
In the past year NSC had a positive cash flow from operations.
Each year in the past 5 years NSC has been profitable.
In the past 5 years NSC always reported a positive cash flow from operatings.
1.2 Ratios
NSC's Return On Assets of 6.64% is fine compared to the rest of the industry. NSC outperforms 76.74% of its industry peers.
The Return On Equity of NSC (19.54%) is better than 83.72% of its industry peers.
NSC has a better Return On Invested Capital (8.30%) than 79.07% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NSC is above the industry average of 6.83%.
| 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
NSC has a Profit Margin of 24.19%. This is amongst the best in the industry. NSC outperforms 88.37% of its industry peers.
NSC's Profit Margin has declined in the last couple of years.
With an excellent Operating Margin value of 35.39%, NSC belongs to the best of the industry, outperforming 93.02% of the companies in the same industry.
NSC's Operating Margin has been stable in the last couple of years.
NSC has a better Gross Margin (50.03%) than 62.79% of its industry peers.
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) below the Cost of Capital (WACC), NSC is destroying value.
The number of shares outstanding for NSC has been increased compared to 1 year ago.
The number of shares outstanding for NSC has been reduced compared to 5 years ago.
Compared to 1 year ago, NSC has an improved debt to assets ratio.
2.2 Solvency
NSC has an Altman-Z score of 2.33. 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.
NSC has a Altman-Z score (2.33) which is comparable to the rest of the industry.
The Debt to FCF ratio of NSC is 8.14, which is on the high side as it means it would take NSC, 8.14 years of fcf income to pay off all of its debts.
NSC has a better Debt to FCF ratio (8.14) than 72.09% of its industry peers.
A Debt/Equity ratio of 1.09 is on the high side and indicates that NSC has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 1.09, NSC is doing worse than 69.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 8.14 | ||
| Altman-Z | 2.33 |
ROIC/WACC0.81
WACC10.24%
2.3 Liquidity
A Current Ratio of 0.86 indicates that NSC may have some problems paying its short term obligations.
NSC has a Current ratio of 0.86. This is in the lower half of the industry: NSC underperforms 69.77% of its industry peers.
A Quick Ratio of 0.78 indicates that NSC may have some problems paying its short term obligations.
NSC's Quick ratio of 0.78 is on the low side compared to the rest of the industry. NSC is outperformed by 72.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.78 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 5.93% over the past year.
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.
Looking at the last year, NSC shows a small growth in Revenue. The Revenue has grown by 0.48% in the last year.
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 7.96% on average over the next years.
The Revenue is expected to grow by 3.76% on average over the next years.
EPS Next Y3.82%
EPS Next 2Y5.83%
EPS Next 3Y7.56%
EPS Next 5Y7.96%
Revenue Next Year1%
Revenue Next 2Y2.12%
Revenue Next 3Y2.93%
Revenue Next 5Y3.76%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 23.88, 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 67.44% of the companies listed in the same industry.
NSC is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.49, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 22.19, which indicates a rather expensive current valuation of NSC.
69.77% of the companies in the same industry are more expensive than NSC, based on the Price/Forward Earnings ratio.
NSC is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 23.69, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.88 | ||
| Fwd PE | 22.19 |
4.2 Price Multiples
NSC's Enterprise Value to EBITDA ratio is in line with the industry average.
NSC's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. NSC is cheaper than 79.07% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.45 | ||
| EV/EBITDA | 14.3 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
NSC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)6.26
PEG (5Y)8.16
EPS Next 2Y5.83%
EPS Next 3Y7.56%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.83%, NSC has a reasonable but not impressive dividend return.
NSC's Dividend Yield is rather good when compared to the industry average which is at 1.60. NSC pays more dividend than 81.40% of the companies in the same industry.
NSC's Dividend Yield is slightly below the S&P500 average, which is at 2.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
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
41.16% of the earnings are spent on dividend by NSC. This is a bit on the high side, but may be sustainable.
NSC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP41.16%
EPS Next 2Y5.83%
EPS Next 3Y7.56%
294.19
-0.94 (-0.32%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryGround Transportation
Earnings (Last)
Earnings (Next)
Inst Owners78.43%
Inst Owner Change2.63%
Ins Owners0.02%
Ins Owner Change0.49%
Market Cap66.01B
Revenue(TTM)12.23B
Net Income(TTM)2.96B
Analysts71.11
Price Target317.02 (7.76%)
Short Float %3.25%
Short Ratio5.41
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
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)-0.09%
PT rev (3m)4.94%
EPS NQ rev (1m)-0.5%
EPS NQ rev (3m)-11.76%
EPS NY rev (1m)-0.12%
EPS NY rev (3m)-3.27%
Revenue NQ rev (1m)-0.23%
Revenue NQ rev (3m)-2.69%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-0.61%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.88 | ||
| Fwd PE | 22.19 | ||
| P/S | 5.4 | ||
| P/FCF | 31.45 | ||
| P/OCF | 15.54 | ||
| P/B | 4.36 | ||
| P/tB | 4.36 | ||
| EV/EBITDA | 14.3 |
EPS(TTM)12.32
EY4.19%
EPS(NY)13.26
Fwd EY4.51%
FCF(TTM)9.35
FCFY3.18%
OCF(TTM)18.94
OCFY6.44%
SpS54.5
BVpS67.48
TBVpS67.48
PEG (NY)6.26
PEG (5Y)8.16
Graham Number136.76
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 | 2.33 |
F-Score8
WACC10.24%
ROIC/WACC0.81
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 Y3.82%
EPS Next 2Y5.83%
EPS Next 3Y7.56%
EPS Next 5Y7.96%
Revenue 1Y (TTM)0.48%
Revenue growth 3Y2.85%
Revenue growth 5Y1.42%
Sales Q2Q%1.7%
Revenue Next Year1%
Revenue Next 2Y2.12%
Revenue Next 3Y2.93%
Revenue Next 5Y3.76%
EBIT growth 1Y-2.13%
EBIT growth 3Y0.98%
EBIT growth 5Y2.8%
EBIT Next Year37.07%
EBIT Next 3Y15.58%
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 23.88 and the Price/Book (PB) ratio is 4.36.
How sustainable is the dividend of NORFOLK SOUTHERN CORP (NSC) stock?
The dividend rating of NORFOLK SOUTHERN CORP (NSC) is 6 / 10 and the dividend payout ratio is 41.16%.