NORFOLK SOUTHERN CORP (NSC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NSC - US6558441084 - Common Stock
292.09 USD
+2.06 (+0.71%)
292.09 USD
0 (0%)
Overall NSC gets a fundamental rating of 5 out of 10. We evaluated NSC against 43 industry peers in the Ground Transportation industry. NSC has an excellent profitability rating, but there are concerns on its financial health. NSC has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year NSC was profitable.
NSC had a positive operating cash flow in the past year.
NSC had positive earnings in each of the past 5 years.
In the past 5 years NSC always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of NSC (6.64%) is better than 76.74% of its industry peers.
The Return On Equity of NSC (19.54%) is better than 83.72% of its industry peers.
Looking at the Return On Invested Capital, with a value of 8.30%, NSC is in the better half of the industry, outperforming 79.07% of the companies in the same industry.
NSC had an Average Return On Invested Capital over the past 3 years of 9.15%. This is above the industry average of 6.88%.
| 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.
NSC's Profit Margin has declined in the last couple of years.
NSC has a Operating Margin of 35.39%. This is amongst the best in the industry. NSC outperforms 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.
With a decent Gross Margin value of 50.03%, NSC is doing good in the industry, outperforming 62.79% of the companies in the same industry.
In the last couple of years the Gross Margin of NSC has grown nicely.
| 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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so NSC is destroying value.
Compared to 1 year ago, NSC has more shares outstanding
The number of shares outstanding for NSC has been reduced compared to 5 years ago.
NSC has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.43 indicates that NSC is not a great score, but indicates only limited risk for bankruptcy at the moment.
NSC has a Altman-Z score (2.43) 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.
The Debt to FCF ratio of NSC (8.14) is better 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.
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 | 2.43 |
ROIC/WACC0.76
WACC10.94%
2.3 Liquidity
A Current Ratio of 0.86 indicates that NSC may have some problems paying its short term obligations.
The Current ratio of NSC (0.86) is worse than 69.77% of its industry peers.
A Quick Ratio of 0.78 indicates that NSC may have some problems paying its short term obligations.
With a Quick ratio value of 0.78, NSC is not doing good in the industry: 72.09% of the companies in the same industry are doing better.
| 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.
Looking at the last year, NSC shows a small growth in Revenue. The Revenue has grown by 0.48% in the last year.
Measured over the past years, NSC shows a small growth in Revenue. The Revenue has been growing by 1.42% on average per year.
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
NSC is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.55% yearly.
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.
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
With a Price/Earnings ratio of 23.71, NSC is valued on the expensive side.
69.77% of the companies in the same industry are more expensive than NSC, based on the Price/Earnings ratio.
NSC is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.31, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 21.95, which indicates a rather expensive current valuation of NSC.
NSC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. NSC is cheaper than 65.12% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 36.59. NSC is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.71 | ||
| Fwd PE | 21.95 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NSC is on the same level as its industry peers.
NSC's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. NSC is cheaper than 76.74% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 34.05 | ||
| EV/EBITDA | 15.17 |
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)6.02
PEG (5Y)8.1
EPS Next 2Y6.01%
EPS Next 3Y7.6%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.86%, NSC has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.83, 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 2.40, NSC is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.86% |
5.2 History
The dividend of NSC is nicely growing with an annual growth rate of 8.41%!
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 around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP41.16%
EPS Next 2Y6.01%
EPS Next 3Y7.6%
292.09
+2.06 (+0.71%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryGround Transportation
Earnings (Last)
Earnings (Next)
Inst Owners80.6%
Inst Owner Change2.62%
Ins Owners0.02%
Ins Owner Change0.49%
Market Cap65.54B
Revenue(TTM)12.23B
Net Income(TTM)2.96B
Analysts70
Price Target317.97 (8.86%)
Short Float %2.55%
Short Ratio4.43
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.86% |
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)3.68%
PT rev (3m)5.93%
EPS NQ rev (1m)-8.99%
EPS NQ rev (3m)-11.67%
EPS NY rev (1m)-1.53%
EPS NY rev (3m)-3.16%
Revenue NQ rev (1m)-1.91%
Revenue NQ rev (3m)-2.41%
Revenue NY rev (1m)-0.42%
Revenue NY rev (3m)-0.58%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.71 | ||
| Fwd PE | 21.95 | ||
| P/S | 5.84 | ||
| P/FCF | 34.05 | ||
| P/OCF | 16.82 | ||
| P/B | 4.72 | ||
| P/tB | 4.72 | ||
| EV/EBITDA | 15.17 |
EPS(TTM)12.32
EY4.22%
EPS(NY)13.31
Fwd EY4.56%
FCF(TTM)8.58
FCFY2.94%
OCF(TTM)17.36
OCFY5.94%
SpS49.98
BVpS61.87
TBVpS61.87
PEG (NY)6.02
PEG (5Y)8.1
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 | 2.43 |
F-Score8
WACC10.94%
ROIC/WACC0.76
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 23.71 and the Price/Book (PB) ratio is 4.72.
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%.