NORFOLK SOUTHERN CORP (NSC) Stock Fundamental Analysis
USA - NYSE:NSC - US6558441084 - Common Stock
280.5 USD
-3.33 (-1.17%)
280.5 USD
0 (0%)
Overall NSC gets a fundamental rating of 5 out of 10. We evaluated NSC against 42 industry peers in the Ground Transportation industry. NSC scores excellent on profitability, but there are concerns on its financial health. NSC has a correct valuation and a medium growth rate. NSC also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
NSC had positive earnings in the past year.
In the past year NSC had a positive cash flow from operations.
Each year in the past 5 years NSC has been profitable.
Each year in the past 5 years NSC had a positive operating cash flow.
1.2 Ratios
NSC has a better Return On Assets (7.58%) than 80.95% of its industry peers.
With an excellent Return On Equity value of 22.63%, NSC belongs to the best of the industry, outperforming 88.10% of the companies in the same industry.
NSC's Return On Invested Capital of 9.16% is fine compared to the rest of the industry. NSC outperforms 78.57% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NSC is in line with the industry average of 7.76%.
The 3 year average ROIC (9.15%) for NSC is below the current ROIC(9.16%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.58% | ||
| ROE | 22.63% | ||
| ROIC | 9.16% |
ROA(3y)6.26%
ROA(5y)6.38%
ROE(3y)19.41%
ROE(5y)18.77%
ROIC(3y)9.15%
ROIC(5y)8.93%
1.3 Margins
With an excellent Profit Margin value of 27.48%, NSC belongs to the best of the industry, outperforming 92.86% of the companies in the same industry.
NSC's Profit Margin has declined in the last couple of years.
NSC's Operating Margin of 38.68% is amongst the best of the industry. NSC outperforms 97.62% of its industry peers.
NSC's Operating Margin has been stable in the last couple of years.
The Gross Margin of NSC (51.67%) is better than 66.67% of its industry peers.
NSC's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 38.68% | ||
| PM (TTM) | 27.48% | ||
| GM | 51.67% |
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 just above the Cost of Capital (WACC), so NSC is still creating some value.
Compared to 1 year ago, NSC has more shares outstanding
Compared to 5 years ago, NSC has less shares outstanding
The debt/assets ratio for NSC has been reduced compared to a year ago.
2.2 Solvency
NSC has an Altman-Z score of 2.42. 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 (2.42) is comparable to the rest of the industry.
The Debt to FCF ratio of NSC is 8.58, which is on the high side as it means it would take NSC, 8.58 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of NSC (8.58) is better than 71.43% of its industry peers.
A Debt/Equity ratio of 1.11 is on the high side and indicates that NSC has dependencies on debt financing.
The Debt to Equity ratio of NSC (1.11) is worse than 76.19% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.11 | ||
| Debt/FCF | 8.58 | ||
| Altman-Z | 2.42 |
ROIC/WACC1.02
WACC9.02%
2.3 Liquidity
A Current Ratio of 0.79 indicates that NSC may have some problems paying its short term obligations.
NSC has a worse Current ratio (0.79) than 78.57% of its industry peers.
A Quick Ratio of 0.71 indicates that NSC may have some problems paying its short term obligations.
NSC's Quick ratio of 0.71 is on the low side compared to the rest of the industry. NSC is outperformed by 80.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.79 | ||
| Quick Ratio | 0.71 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 5.93% over the past year.
The Earnings Per Share has been growing slightly by 2.93% on average over the past years.
Looking at the last year, NSC shows a decrease in Revenue. The Revenue has decreased by -0.27% in the last year.
The Revenue has been growing slightly by 1.42% on average over the past years.
EPS 1Y (TTM)5.93%
EPS 3Y-0.78%
EPS 5Y2.93%
EPS Q2Q%1.54%
Revenue 1Y (TTM)-0.27%
Revenue growth 3Y2.85%
Revenue growth 5Y1.42%
Sales Q2Q%1.7%
3.2 Future
Based on estimates for the next years, NSC will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.42% on average per year.
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.
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
With a Price/Earnings ratio of 22.77, NSC is valued on the expensive side.
Based on the Price/Earnings ratio, NSC is valued a bit cheaper than 71.43% of the companies in the same industry.
NSC is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.91, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 20.25, NSC is valued on the expensive side.
Based on the Price/Forward Earnings ratio, NSC is valued a bit cheaper than the industry average as 66.67% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of NSC to the average of the S&P500 Index (22.92), we can say NSC is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.77 | ||
| Fwd PE | 20.25 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as NSC.
Based on the Price/Free Cash Flow ratio, NSC is valued a bit cheaper than the industry average as 76.19% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.91 | ||
| EV/EBITDA | 14.06 |
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 excellent profitability rating of NSC may justify a higher PE ratio.
PEG (NY)4.1
PEG (5Y)7.78
EPS Next 2Y8.17%
EPS Next 3Y8.85%
5. Dividend
5.1 Amount
NSC has a Yearly Dividend Yield of 1.90%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.60, NSC pays a better dividend. On top of this NSC pays more dividend than 80.95% of the companies listed in the same industry.
NSC's Dividend Yield is comparable with the S&P500 average which is at 2.34.
| 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 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 36.45% of its income as dividend. This is a sustainable payout ratio.
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.
DP36.45%
EPS Next 2Y8.17%
EPS Next 3Y8.85%
280.5
-3.33 (-1.17%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryGround Transportation
Earnings (Last)
Earnings (Next)
Inst Owners80.6%
Inst Owner Change-0.55%
Ins Owners0.02%
Ins Owner Change0.68%
Market Cap68.64B
Revenue(TTM)12.12B
Net Income(TTM)3.35B
Analysts70
Price Target306.7 (9.34%)
Short Float %2.23%
Short Ratio3.23
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.9% |
Yearly Dividend5.4
Dividend Growth(5Y)8.41%
DP36.45%
Div Incr Years0
Div Non Decr Years23
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-1.19%
Min EPS beat(2)-1.39%
Max EPS beat(2)-0.99%
EPS beat(4)2
Avg EPS beat(4)0.76%
Min EPS beat(4)-1.39%
Max EPS beat(4)3.5%
EPS beat(8)3
Avg EPS beat(8)-0.08%
EPS beat(12)5
Avg EPS beat(12)0.7%
EPS beat(16)7
Avg EPS beat(16)0.76%
Revenue beat(2)0
Avg Revenue beat(2)-1.02%
Min Revenue beat(2)-1.61%
Max Revenue beat(2)-0.43%
Revenue beat(4)0
Avg Revenue beat(4)-1.29%
Min Revenue beat(4)-2.12%
Max Revenue beat(4)-0.43%
Revenue beat(8)0
Avg Revenue beat(8)-1.24%
Revenue beat(12)2
Avg Revenue beat(12)-0.98%
Revenue beat(16)6
Avg Revenue beat(16)-0.28%
PT rev (1m)0.61%
PT rev (3m)10.78%
EPS NQ rev (1m)-2.77%
EPS NQ rev (3m)-4.02%
EPS NY rev (1m)-0.07%
EPS NY rev (3m)-0.38%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)-0.22%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)-0.01%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.77 | ||
| Fwd PE | 20.25 | ||
| P/S | 5.64 | ||
| P/FCF | 33.91 | ||
| P/OCF | 16.33 | ||
| P/B | 4.64 | ||
| P/tB | 4.64 | ||
| EV/EBITDA | 14.06 |
EPS(TTM)12.32
EY4.39%
EPS(NY)13.85
Fwd EY4.94%
FCF(TTM)8.27
FCFY2.95%
OCF(TTM)17.18
OCFY6.12%
SpS49.77
BVpS60.43
TBVpS60.43
PEG (NY)4.1
PEG (5Y)7.78
Graham Number129.42
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.58% | ||
| ROE | 22.63% | ||
| ROCE | 11.64% | ||
| ROIC | 9.16% | ||
| ROICexc | 9.47% | ||
| ROICexgc | 9.47% | ||
| OM | 38.68% | ||
| PM (TTM) | 27.48% | ||
| GM | 51.67% | ||
| FCFM | 16.62% |
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 Turnover0.28
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.11 | ||
| Debt/FCF | 8.58 | ||
| Debt/EBITDA | 2.71 | ||
| Cap/Depr | 158.78% | ||
| Cap/Sales | 17.9% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 69.1% | ||
| Profit Quality | 60.47% | ||
| Current Ratio | 0.79 | ||
| Quick Ratio | 0.71 | ||
| Altman-Z | 2.42 |
F-Score8
WACC9.02%
ROIC/WACC1.02
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)-0.27%
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 1Y22.55%
EBIT growth 3Y0.98%
EBIT growth 5Y2.8%
EBIT Next Year40.01%
EBIT Next 3Y16.85%
EBIT Next 5Y11.49%
FCF growth 1Y1.3%
FCF growth 3Y-78.42%
FCF growth 5Y-56.86%
OCF growth 1Y3.62%
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 8 / 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 22.77 and the Price/Book (PB) ratio is 4.64.
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 36.45%.