Norfolk Southern (NSC) AI Stock Analysis

• Market Cap: $71.25B
• Dividend Yield: 1.87%
• Average Volume (3M): 1.53M
• Price to Earnings (P/E): 19.7
• Beta (1Y): 0.89
• Revenue Growth: 0.71%
• EPS Growth: 86.84%
• Country: US
• Employees: 19,600
• Sector: Industrials
• Sector Strength: 72
• Industry: Railroads
• EPS (TTM): N/A
• Shares Outstanding: 244,708,450
• 10 Day Avg. Volume: 984,704
• 30 Day Avg. Volume: 1,533,029
• PEG Ratio: 0.46
• Price to Book (P/B): 3.71
• Price to Sales (P/S): 4.38
• P/FCF Ratio: 31.76
• Enterprise Value/Market Cap: 1.03
• Enterprise Value/Revenue: 6.05
• Enterprise Value/Gross Profit: 16.77
• Enterprise Value/Ebitda: 11.32
• 1Y Price Target: $317.30
• Price Target Upside: 9.93% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11

• Rating: 73 Outperform
• Price Target: $323.00 ▲(11.91% Upside)

Norfolk Southern's strong financial performance is the most significant factor, supported by robust profitability and efficient cash flow management. Technical analysis indicates some short-term weakness but overall stability. Valuation metrics suggest the stock is fairly valued with a reasonable dividend yield. The absence of recent earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Major Merger Announcement

The merger with Union Pacific is expected to enhance Norfolk Southern's market position and operational capabilities, providing long-term growth opportunities and transforming the U.S. supply chain.

Strong Cash Flow Management

Strong cash flow management supports Norfolk Southern's operational and financial stability, enabling the company to invest in growth opportunities and maintain resilience against economic challenges.

Operational Efficiency

Improved operational efficiency through labor productivity savings enhances Norfolk Southern's cost structure, supporting profitability and competitive positioning in the rail industry.

Negative Factors

Coal Revenue Pressure

Declining coal revenue due to lower prices poses a challenge to Norfolk Southern's revenue diversification, impacting its ability to maintain stable income from this segment.

Moderate Leverage

While leverage remains manageable, it could pose a risk if not carefully managed, potentially limiting Norfolk Southern's financial flexibility and ability to respond to market changes.

Uncertain Economic Environment

Economic uncertainties, including potential tariffs, could affect demand for Norfolk Southern's transportation services, impacting future revenue growth and operational planning.

Norfolk Southern Business Overview & Revenue Model

Company Description

Norfolk Southern Corporation, together with its subsidiaries, engages in the rail transportation of raw materials, intermediate products, and finished goods in the United States. The company transports agriculture, forest, and consumer products comprising soybeans, wheat, corn, fertilizers, livestock and poultry feed, food products, food oils, flour, sweeteners, ethanol, lumber and wood products, pulp board and paper products, wood fibers, wood pulp, scrap paper, beverages, canned goods, and consumer products; chemicals consist of sulfur and related chemicals, petroleum products, chlorine and bleaching compounds, plastics, rubber, industrial chemicals, chemical wastes, and sand; metals and construction materials, such as steel, aluminum products, machinery, scrap metals, cement, aggregates, minerals, clay, transportation equipment, and military-related products; and automotive, including finished motor vehicles and automotive parts, as well as coal. It also transports overseas freight through various Atlantic and Gulf Coast ports; and provides commuter rail passenger transportation services and operates an intermodal network. As of December 31, 2021, the company operated approximately 19,300 route miles in 22 states and the District of Columbia. Norfolk Southern Corporation was incorporated in 1980 and is based in Atlanta, Georgia.

How the Company Makes Money

Norfolk Southern generates revenue primarily through freight transportation services. The company charges customers for moving goods via its rail network, with revenue streams categorized into several segments: intermodal, coal, automotive, and merchandise. The intermodal segment, which involves transporting containers and trailers, is a significant source of revenue due to the growing demand for efficient logistics solutions. The coal segment has historically been a major contributor, particularly in regions rich in natural resources. Additionally, Norfolk Southern partners with various companies across industries to optimize supply chain logistics, enhancing its service offerings and customer base. Factors influencing its earnings include rail traffic volume, freight rates, operational efficiency, and the overall health of the economy, which affects demand for transportation services.

Norfolk Southern Financial Statement Overview

Summary

Norfolk Southern exhibits strong financial health across its income statement, balance sheet, and cash flow. The company shows robust profitability and efficient operations, with consistent cash flow generation. While leverage is moderate, it remains manageable. The overall financial position is solid, positioning the company well for future growth and stability in the railroads industry.

Income Statement

Norfolk Southern's income statement shows strong profitability with a TTM net profit margin of 27.51% and a gross profit margin of 47.99%. The EBIT and EBITDA margins are also robust at 42.15% and 53.42%, respectively. Revenue growth has been inconsistent, with a slight decline in the most recent annual report but a positive trend in the TTM data. Overall, the company demonstrates solid profitability and efficiency in its operations.

Balance Sheet

The balance sheet reflects a moderate level of leverage with a debt-to-equity ratio of 1.17 in the TTM period, which is slightly improved from previous years. Return on equity is strong at 23.35%, indicating effective use of equity to generate profits. The equity ratio is stable, suggesting a balanced capital structure. While the company maintains a healthy financial position, the leverage could pose a risk if not managed carefully.

Cash Flow

Cash flow analysis reveals a positive trajectory with a 7.15% growth in free cash flow in the TTM period. The operating cash flow to net income ratio is healthy at 1.15, indicating strong cash generation relative to net income. The free cash flow to net income ratio is also solid at 0.48. Overall, Norfolk Southern demonstrates strong cash flow management, supporting its operational and financial stability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	12.18B	12.12B	12.16B	12.74B	11.14B	9.79B
Gross Profit	4.39B	3.76B	2.81B	4.73B	4.37B	3.40B
EBITDA	6.51B	5.49B	4.34B	6.04B	5.71B	4.31B
Net Income	3.35B	2.62B	1.83B	3.27B	3.00B	2.01B
Balance Sheet
Total Assets	44.16B	43.68B	41.65B	38.88B	38.49B	37.96B
Cash, Cash Equivalents and Short-Term Investments	1.30B	1.64B	1.57B	456.00M	839.00M	1.11B
Total Debt	17.37B	17.48B	17.57B	15.59B	14.25B	13.11B
Total Liabilities	29.37B	29.38B	28.87B	26.15B	24.85B	23.17B
Stockholders Equity	14.79B	14.31B	12.78B	12.73B	13.64B	14.79B
Cash Flow
Free Cash Flow	2.02B	1.67B	830.00M	2.27B	2.79B	2.14B
Operating Cash Flow	4.20B	4.05B	3.18B	4.22B	4.25B	3.64B
Investing Cash Flow	-1.65B	-2.78B	-2.18B	-1.60B	-1.22B	-1.18B
Financing Cash Flow	-1.91B	-1.20B	115.00M	-3.00B	-3.31B	-1.93B

Norfolk Southern Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 288.63
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NSC, the sentiment is Neutral. The current price of 288.63 is below the 20-day moving average (MA) of 294.34, above the 50-day MA of 285.61, and above the 200-day MA of 254.35, indicating a neutral trend. The MACD of 1.15 indicates Positive momentum. The RSI at 49.68 is Neutral, neither overbought nor oversold. The STOCH value of 28.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NSC.

Norfolk Southern Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CSX	77 Outperform	$66.53B	23.23	22.60%	1.42%	-3.80%	-17.32%
UNP	77 Outperform	$134.82B	19.74	42.35%	2.38%	1.06%	8.13%
NSC	73 Outperform	$71.25B	19.67	24.11%	1.87%	0.71%	86.84%
FDX	73 Outperform	$56.58B	14.02	14.98%	2.36%	1.14%	4.99%
CNR	69 Neutral	C$83.14B	18.36	21.83%	2.61%	0.63%	-14.20%
JBHT	68 Neutral	$16.36B	29.25	15.13%	1.04%	-1.60%	―
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Norfolk Southern Corporate Events

Union Pacific to Acquire Norfolk Southern in Strategic Merger

Union Pacific Corporation is set to acquire Norfolk Southern Corporation through a merger agreement announced on July 28, 2025. The merger, which involves two stages, will result in Norfolk Southern becoming a wholly owned subsidiary of Union Pacific. Shareholders of Norfolk Southern will receive Union Pacific common stock and cash as part of the merger consideration. Upon completion, former Norfolk Southern shareholders will own approximately 27% of Union Pacific’s outstanding common stock. This strategic acquisition is expected to enhance Union Pacific’s market position in the rail transportation industry.

The most recent analyst rating on (NSC) stock is a Buy with a $347.00 price target. To see the full list of analyst forecasts on Norfolk Southern stock, see the NSC Stock Forecast page.

Norfolk Southern Approves Executive Retention Awards Amid Merger

On September 23, 2025, Norfolk Southern‘s Board of Directors approved one-time cash retention awards for its named executive officers as part of a transaction bonus program. This initiative, linked to the merger agreement with Union Pacific Corporation, aims to ensure leadership stability and focus amid the merger’s uncertainty, benefiting the company’s stakeholders.

The most recent analyst rating on (NSC) stock is a Buy with a $339.00 price target. To see the full list of analyst forecasts on Norfolk Southern stock, see the NSC Stock Forecast page.

Norfolk Southern Reports Strong Q2 2025 Results

Norfolk Southern Corporation is a leading freight transportation company operating a 22-state network in the United States, known for its extensive intermodal network and commitment to sustainability. In its second quarter of 2025, Norfolk Southern reported a 4% increase in net income and a 5% rise in earnings per share, with adjusted figures showing even stronger growth. The company achieved $3.1 billion in revenue and $1.2 billion in income from railway operations, reflecting a robust performance despite market uncertainties. Key financial metrics included a 62.2% operating ratio and $3.41 diluted earnings per share, with adjusted figures showing improvements over the previous year. Looking ahead, Norfolk Southern expects a 2-3% revenue growth for the full year and anticipates further improvements in its operating ratio, although it acknowledges potential challenges in the third quarter. The company also announced a significant merger with Union Pacific, aiming to create America’s first transcontinental railroad, a move that could reshape the industry landscape.

Norfolk Southern Announces Merger with Union Pacific

On July 28, 2025, Norfolk Southern Corporation entered into a merger agreement with Union Pacific Corporation, which will see Union Pacific acquire Norfolk Southern in a stock-and-cash transaction. The merger will result in Norfolk Southern becoming a wholly owned subsidiary of Union Pacific, with certain governance changes including the appointment of Norfolk Southern directors to Union Pacific’s board. The merger is subject to customary conditions, including shareholder and regulatory approvals, and includes provisions for termination fees in specific circumstances.

The most recent analyst rating on (NSC) stock is a Hold with a $275.00 price target. To see the full list of analyst forecasts on Norfolk Southern stock, see the NSC Stock Forecast page.

Norfolk Southern Reports Q2 Results, Announces Major Merger

On July 29, 2025, Norfolk Southern Corporation reported its second-quarter financial results, showing a 4% increase in net income and a 5% rise in earnings per share. The company achieved $3.1 billion in revenue and $1.2 billion in income from railway operations, with an operating ratio of 62.2%. Adjusted figures, excluding restructuring costs and the Eastern Ohio incident, showed a 7% improvement in income from railway operations and an 8% increase in earnings per share. Norfolk Southern also announced a merger with Union Pacific to create the first transcontinental railroad in the U.S., valued at $85 billion. This merger is expected to significantly impact the company’s market position and operations.

The most recent analyst rating on (NSC) stock is a Hold with a $275.00 price target. To see the full list of analyst forecasts on Norfolk Southern stock, see the NSC Stock Forecast page.

Norfolk Southern and Union Pacific Announce Major Merger

On July 29, 2025, Norfolk Southern and Union Pacific announced a merger agreement to create America’s first transcontinental railroad, valued at over $250 billion. This merger is expected to transform the U.S. supply chain, enhance freight competition, and provide significant economic benefits, including job preservation and growth opportunities for employees.

The most recent analyst rating on (NSC) stock is a Hold with a $275.00 price target. To see the full list of analyst forecasts on Norfolk Southern stock, see the NSC Stock Forecast page.

Norfolk Southern in Advanced Merger Talks with Union Pacific

On July 24, 2025, Norfolk Southern Corporation and Union Pacific Corporation announced they are in advanced discussions about a potential merger. While no agreement has been reached yet, the discussions could significantly impact the freight transportation industry, potentially enhancing operational efficiencies and expanding market reach for both companies.

The most recent analyst rating on (NSC) stock is a Hold with a $275.00 price target. To see the full list of analyst forecasts on Norfolk Southern stock, see the NSC Stock Forecast page.