NORFOLK SOUTHERN CORP (NSC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NSC - US6558441084 - Common Stock
290.96 USD
-1.75 (-0.6%)
290.96 USD
0 (0%)
Taking everything into account, NSC scores 5 out of 10 in our fundamental rating. NSC was compared to 42 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 has a correct valuation and a medium 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.
In the past 5 years NSC has always been profitable.
NSC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NSC's Return On Assets of 6.64% is fine compared to the rest of the industry. NSC outperforms 76.19% 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 83.33% of the companies in the same industry.
With a decent Return On Invested Capital value of 8.30%, NSC is doing good in the industry, outperforming 78.57% 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 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
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.
NSC has a better Gross Margin (50.03%) than 61.90% 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
NSC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for NSC has been increased compared to 1 year ago.
NSC has less shares outstanding than it did 5 years ago.
NSC has a better debt/assets ratio than last year.
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 in line with its industry peers.
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.
Looking at the Debt to FCF ratio, with a value of 8.14, NSC is in the better half of the industry, outperforming 71.43% 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.
The Debt to Equity ratio of NSC (1.09) is worse than 69.05% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 8.14 | ||
| Altman-Z | 2.33 |
ROIC/WACC0.83
WACC9.98%
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 69.05% 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.
Looking at the Quick ratio, with a value of 0.78, NSC is doing worse than 71.43% of the companies in the same industry.
| 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.
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)0.48%
Revenue growth 3Y2.85%
Revenue growth 5Y1.42%
Sales Q2Q%1.7%
3.2 Future
NSC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.96% yearly.
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
Based on the Price/Earnings ratio of 23.62, the valuation of NSC can be described as rather expensive.
NSC's Price/Earnings ratio is a bit cheaper when compared to the industry. NSC is cheaper than 69.05% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.57, NSC is valued at the same level.
With a Price/Forward Earnings ratio of 21.94, NSC is valued on the expensive side.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NSC indicates a somewhat cheap valuation: NSC is cheaper than 69.05% of the companies listed in the same industry.
NSC's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.04.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.62 | ||
| Fwd PE | 21.94 |
4.2 Price Multiples
NSC's Enterprise Value to EBITDA ratio is in line with 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 | 31.1 | ||
| EV/EBITDA | 14.25 |
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)6.19
PEG (5Y)8.07
EPS Next 2Y5.83%
EPS Next 3Y7.56%
5. Dividend
5.1 Amount
NSC has a Yearly Dividend Yield of 1.85%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 0.75, NSC pays a better dividend. On top of this NSC pays more dividend than 83.33% of the companies listed in the same industry.
NSC's Dividend Yield is comparable with the S&P500 average which is at 1.88.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.85% |
5.2 History
On average, the dividend of NSC grows each year by 8.41%, which is quite nice.
NSC has been paying a dividend for at least 10 years, so it has 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, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP41.16%
EPS Next 2Y5.83%
EPS Next 3Y7.56%
290.96
-1.75 (-0.6%)
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 Change0.51%
Market Cap65.29B
Revenue(TTM)12.23B
Net Income(TTM)2.96B
Analysts71.11
Price TargetN/A
Short Float %2.86%
Short Ratio4.86
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.85% |
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%
EPS NQ rev (1m)-0.17%
EPS NQ rev (3m)-11.73%
EPS NY rev (1m)-0.12%
EPS NY rev (3m)-3.27%
Revenue NQ rev (1m)-0.16%
Revenue NQ rev (3m)-2.63%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-0.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.62 | ||
| Fwd PE | 21.94 | ||
| P/S | 5.34 | ||
| P/FCF | 31.1 | ||
| P/OCF | 15.37 | ||
| P/B | 4.31 | ||
| P/tB | 4.31 | ||
| EV/EBITDA | 14.25 |
EPS(TTM)12.32
EY4.23%
EPS(NY)13.26
Fwd EY4.56%
FCF(TTM)9.35
FCFY3.21%
OCF(TTM)18.94
OCFY6.51%
SpS54.5
BVpS67.48
TBVpS67.48
PEG (NY)6.19
PEG (5Y)8.07
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
WACC9.98%
ROIC/WACC0.83
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 23.62 and the Price/Book (PB) ratio is 4.31.
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%.