NORFOLK SOUTHERN CORP (NSC) Stock Fundamental Analysis
USA - NYSE:NSC - US6558441084 - Common Stock
281.64 USD
+1.14 (+0.41%)
419.999 USD
+138.36 (+49.13%)
We assign a fundamental rating of 5 out of 10 to NSC. NSC was compared to 42 industry peers in the Ground Transportation industry. While NSC has a great profitability rating, there are quite some concerns on its financial health. NSC is not valued too expensively and it also shows a decent growth rate. NSC also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year NSC was profitable.
NSC had a positive operating cash flow in the past year.
In the past 5 years NSC has always been profitable.
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 76.19% of its industry peers.
The Return On Equity of NSC (19.54%) is better than 85.71% 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 76.19% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for NSC is in line with the industry average of 7.72%.
| 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
The Profit Margin of NSC (24.19%) is better than 88.10% of its industry peers.
In the last couple of years the Profit Margin of NSC has declined.
NSC has a Operating Margin of 35.39%. This is amongst the best in the industry. NSC outperforms 92.86% of its industry peers.
NSC's Operating Margin has been stable in the last couple of years.
With a decent Gross Margin value of 50.03%, NSC is doing good in the industry, outperforming 61.90% 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.
Compared to 1 year ago, NSC has more shares outstanding
Compared to 5 years ago, NSC has less shares outstanding
NSC has a better debt/assets ratio than last year.
2.2 Solvency
NSC has an Altman-Z score of 2.39. 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.
The Altman-Z score of NSC (2.39) is comparable to the rest of the 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.
NSC has a better Debt to FCF ratio (8.14) than 71.43% 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's Debt to Equity ratio of 1.09 is on the low side compared to the rest of the industry. NSC is outperformed by 76.19% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 8.14 | ||
| Altman-Z | 2.39 |
ROIC/WACC0.92
WACC9.07%
2.3 Liquidity
NSC has a Current 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 Current ratio (0.86) than 71.43% 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.
The Quick ratio of NSC (0.78) is worse than 76.19% 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%.
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 9.42% yearly.
Based on estimates for the next years, NSC will show a small growth in Revenue. The Revenue will grow by 3.65% on average per year.
EPS Next Y5.55%
EPS Next 2Y8.17%
EPS Next 3Y8.85%
EPS Next 5Y9.42%
Revenue Next Year1.45%
Revenue Next 2Y2.72%
Revenue Next 3Y3.26%
Revenue Next 5Y3.65%
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 22.86, NSC is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of NSC indicates a somewhat cheap valuation: NSC is cheaper than 71.43% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 27.08. NSC is around the same levels.
Based on the Price/Forward Earnings ratio of 20.33, the valuation of NSC can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NSC indicates a somewhat cheap valuation: NSC is cheaper than 66.67% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.09. NSC is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.86 | ||
| Fwd PE | 20.33 |
4.2 Price Multiples
NSC's Enterprise Value to EBITDA is on the same level as the industry average.
76.19% 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 | 32.83 | ||
| EV/EBITDA | 14.76 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of NSC may justify a higher PE ratio.
PEG (NY)4.12
PEG (5Y)7.81
EPS Next 2Y8.17%
EPS Next 3Y8.85%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.93%, 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 1.65. NSC pays more dividend than 80.95% of the companies in the same industry.
NSC's Dividend Yield is comparable with the S&P500 average which is at 2.30.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.93% |
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 their dividend for at least 10 years, which is a reliable track record.
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.
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 2Y8.17%
EPS Next 3Y8.85%
281.64
+1.14 (+0.41%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryGround Transportation
Earnings (Last)
Earnings (Next)
Inst Owners80.6%
Inst Owner Change-0.46%
Ins Owners0.02%
Ins Owner Change0.19%
Market Cap68.92B
Revenue(TTM)12.23B
Net Income(TTM)2.96B
Analysts70
Price Target306.7 (8.9%)
Short Float %2.59%
Short Ratio3.75
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.93% |
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)0.61%
PT rev (3m)10.78%
EPS NQ rev (1m)-3.81%
EPS NQ rev (3m)-5.08%
EPS NY rev (1m)-1.59%
EPS NY rev (3m)-1.96%
Revenue NQ rev (1m)-0.32%
Revenue NQ rev (3m)-0.57%
Revenue NY rev (1m)-0.18%
Revenue NY rev (3m)-0.21%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.86 | ||
| Fwd PE | 20.33 | ||
| P/S | 5.64 | ||
| P/FCF | 32.83 | ||
| P/OCF | 16.22 | ||
| P/B | 4.55 | ||
| P/tB | 4.55 | ||
| EV/EBITDA | 14.76 |
EPS(TTM)12.32
EY4.37%
EPS(NY)13.85
Fwd EY4.92%
FCF(TTM)8.58
FCFY3.05%
OCF(TTM)17.36
OCFY6.17%
SpS49.98
BVpS61.87
TBVpS61.87
PEG (NY)4.12
PEG (5Y)7.81
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 | 2.39 |
F-Score8
WACC9.07%
ROIC/WACC0.92
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 Y5.55%
EPS Next 2Y8.17%
EPS Next 3Y8.85%
EPS Next 5Y9.42%
Revenue 1Y (TTM)0.48%
Revenue growth 3Y2.85%
Revenue growth 5Y1.42%
Sales Q2Q%1.7%
Revenue Next Year1.45%
Revenue Next 2Y2.72%
Revenue Next 3Y3.26%
Revenue Next 5Y3.65%
EBIT growth 1Y-2.13%
EBIT growth 3Y0.98%
EBIT growth 5Y2.8%
EBIT Next Year40.01%
EBIT Next 3Y16.85%
EBIT Next 5Y11.49%
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 22.86 and the Price/Book (PB) ratio is 4.55.
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%.