tiprankstipranks
Trending News
More News >
Norfolk Southern Corp (NSC)
:NSC
Advertisement

Norfolk Southern (NSC) AI Stock Analysis

Compare
1,300 Followers

Top Page

NSC

Norfolk Southern

(NYSE:NSC)

Rating:79Outperform
Price Target:
$323.00
â–²(14.60% Upside)
Norfolk Southern's overall stock score reflects its strong financial performance, favorable technical indicators, and strategic corporate developments. The major merger announcement is a key positive factor, enhancing future growth prospects. While economic uncertainties and coal revenue pressures pose challenges, the company's proactive management and operational efficiencies provide a solid foundation for stability and growth.
Positive Factors
Merger and Acquisition
Union Pacific’s $320/sh bid for NSC reflects a 25% premium to its 30-day volume weighted average price and values the company at an EV of $85B.
Potential Industry Impact
The proposed merger between NSC and UNP could create the first transcontinental railroad in the U.S., potentially benefiting industry, communities, shippers, and labor.
Productivity Savings
NSC now sees a minimum of $175M+ of y/y productivity savings versus its prior forecast of $150M+.
Negative Factors
Fuel and Coal Pricing
Lower fuel prices and moderating export coal yields are expected to pressure Norfolk Southern's 2Q revenue per carload.
Revenue Forecast
The company lowered its full-year revenue growth target to 2%-3% y/y from 3%, while the adjusted OR is now forecast to improve 100-150 bps versus 150 bps previously.
Volume Trends
Norfolk Southern’s 2Q volumes trended below the prior target, mainly driven by slower Intermodal growth.

Norfolk Southern (NSC) vs. SPDR S&P 500 ETF (SPY)

Norfolk Southern Business Overview & Revenue Model

Company DescriptionNorfolk 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 MoneyNorfolk 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 Key Performance Indicators (KPIs)

Any
Any
Revenue by Segment
Revenue by Segment
Shows revenue generated from different business segments, highlighting which areas are driving growth and profitability, and helping assess the company's strategic focus and market position.
Chart InsightsNorfolk Southern's Merchandise segment shows a steady recovery post-2020, with recent growth indicating resilience despite economic pressures. Coal revenue, after peaking in 2022, is experiencing a gradual decline, reflecting broader industry shifts away from coal reliance. Intermodal revenue has stabilized after a peak in 2022, suggesting adjustments to demand fluctuations. The absence of recent earnings call insights leaves the strategic response to these trends unclear, but the data suggests a focus on diversifying revenue streams and adapting to changing market dynamics.
Data provided by:Main Street Data

Norfolk Southern Earnings Call Summary

Earnings Call Date:Jul 29, 2025
(Q1-2025)
|
% Change Since: -1.12%|
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Neutral
Norfolk Southern experienced significant challenges due to weather-related disruptions, leading to increased costs. However, the company demonstrated resilience and operational efficiency, achieving notable EPS growth and labor productivity savings. Despite facing pressures from lower coal prices and economic uncertainty, the company's proactive cost management and service improvements present a balanced outlook.
Q1-2025 Updates
Positive Updates
EPS Growth Amid Challenges
Norfolk Southern delivered 8% EPS growth on an adjusted basis, despite absorbing $35 million in storm restoration costs.
Labor Productivity Savings
The company achieved $55 million in labor productivity savings, contributing significantly to cost reductions.
Safety Improvements
The FRA injury ratio decreased by 13% year-over-year, and train accident frequency was reduced by 43%.
Intermodal Volume Increase
Intermodal volume increased by 3% year-over-year with gains in both domestic and international segments.
Zero-Based Operating Plan Benefits
The new operating plan led to a net reduction of over 100 weekly crew starts and improved fuel efficiency by 13% year-over-year.
Negative Updates
Storm Restoration Costs
The company incurred $35 million in extraordinary expenses due to winter storm impacts, negatively affecting the operating ratio.
Coal Revenue Pressure
Lower export coal prices drove RPU less fuel lower by 3%, affecting overall revenue performance.
Uncertain Economic Environment
There are concerns about potential tariffs and an uncertain economic environment, which may impact future revenue.
Company Guidance
In the Norfolk Southern Corporation's First Quarter 2025 Earnings Conference Call, the company reported several key metrics and projections. Despite facing significant winter disruptions, including 18 storms and $35 million in storm restoration costs, Norfolk Southern achieved an 8% growth in earnings per share (EPS) on an adjusted basis, supported by $55 million in labor productivity savings. The company maintained an adjusted operating ratio of 67.9%, even with the adverse weather impacts. Additionally, Norfolk Southern set a record for fuel efficiency for the fourth consecutive quarter with a 13% year-over-year improvement in horsepower per ton (HPT). The company is committed to a $150 million cost reduction for the full year and projects a 3% revenue growth alongside 150 basis points of operating ratio improvement, although it acknowledged the uncertainty in the market due to potential tariff impacts and broader economic conditions.

Norfolk Southern Financial Statement Overview

Summary
Norfolk Southern demonstrates solid financial health with strong profitability and efficient cash flow management. While revenue growth has plateaued, profitability metrics remain high, and the balance sheet is well-structured with manageable leverage.
Income Statement
78
Positive
Norfolk Southern shows robust profitability with a strong gross profit margin of 45.3% and a net profit margin of 27.4% TTM (Trailing-Twelve-Months). EBIT and EBITDA margins are also healthy at 41.1% and 50.3% respectively. However, revenue growth has been stagnant, with a slight decline in total revenue over the recent periods, which may signal challenges in expanding market reach or competitive pressures.
Balance Sheet
75
Positive
The balance sheet indicates solid equity with a debt-to-equity ratio of 1.19 and an equity ratio of 33.1% TTM. Return on Equity is commendable at 22.9%, reflecting effective use of shareholder funds. The company's substantial debt load is balanced by strong equity, yet the relatively high leverage could pose risks if market conditions change.
Cash Flow
82
Very Positive
Cash flow performance is strong, with a free cash flow to net income ratio of 0.70 TTM, highlighting efficient cash conversion. Operating cash flow to net income ratio stands at 1.25, indicating robust cash generation relative to net income. Though free cash flow growth has been inconsistent, the company maintains healthy operational cash flows.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue12.18B12.12B12.16B12.74B11.14B9.79B
Gross Profit4.39B3.76B2.81B4.73B4.37B3.40B
EBITDA6.51B5.49B4.34B6.04B5.71B4.31B
Net Income3.35B2.62B1.83B3.27B3.00B2.01B
Balance Sheet
Total Assets44.16B43.68B41.65B38.88B38.49B37.96B
Cash, Cash Equivalents and Short-Term Investments1.30B1.64B1.57B456.00M839.00M1.11B
Total Debt17.37B17.48B17.57B15.59B14.25B13.11B
Total Liabilities29.37B29.38B28.87B26.15B24.85B23.17B
Stockholders Equity14.79B14.31B12.78B12.73B13.64B14.79B
Cash Flow
Free Cash Flow2.02B1.67B830.00M2.27B2.79B2.14B
Operating Cash Flow4.20B4.05B3.18B4.22B4.25B3.64B
Investing Cash Flow-1.65B-2.78B-2.18B-1.60B-1.22B-1.18B
Financing Cash Flow-1.91B-1.20B115.00M-3.00B-3.31B-1.93B

Norfolk Southern Technical Analysis

Technical Analysis Sentiment
Positive
Last Price281.84
Price Trends
50DMA
264.76
Positive
100DMA
246.27
Positive
200DMA
246.19
Positive
Market Momentum
MACD
4.79
Positive
RSI
63.80
Neutral
STOCH
59.91
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NSC, the sentiment is Positive. The current price of 281.84 is above the 20-day moving average (MA) of 278.98, above the 50-day MA of 264.76, and above the 200-day MA of 246.19, indicating a bullish trend. The MACD of 4.79 indicates Positive momentum. The RSI at 63.80 is Neutral, neither overbought nor oversold. The STOCH value of 59.91 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NSC.

Norfolk Southern Risk Analysis

Norfolk Southern disclosed 25 risk factors in its most recent earnings report. Norfolk Southern reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Norfolk Southern Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
80
Outperform
$129.76B19.0142.35%2.42%1.06%8.13%
79
Outperform
$63.38B19.0924.11%1.91%0.71%86.84%
76
Outperform
$66.78B22.0124.83%1.39%-3.27%-10.73%
73
Outperform
$54.36B13.7014.68%2.42%0.27%-2.64%
67
Neutral
$74.10B13.0034.96%7.39%0.94%9.62%
66
Neutral
$13.83B25.9614.33%1.21%-2.24%-5.43%
63
Neutral
$10.80B16.637.13%2.06%2.21%-15.91%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
NSC
Norfolk Southern
282.50
47.24
20.08%
CSX
CSX
36.35
3.43
10.42%
FDX
FedEx
231.07
-48.20
-17.26%
JBHT
JB Hunt
144.45
-24.01
-14.25%
UNP
Union Pacific
221.52
-17.55
-7.34%
UPS
United Parcel
88.55
-34.11
-27.81%

Norfolk Southern Corporate Events

Executive/Board ChangesM&A Transactions
Norfolk Southern Announces Merger with Union Pacific
Neutral
Jul 29, 2025

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.

M&A TransactionsFinancial Disclosures
Norfolk Southern Reports Q2 Results, Announces Major Merger
Positive
Jul 29, 2025

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.

M&A Transactions
Norfolk Southern and Union Pacific Announce Major Merger
Positive
Jul 29, 2025

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.

M&A Transactions
Norfolk Southern in Advanced Merger Talks with Union Pacific
Neutral
Jul 24, 2025

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.

Executive/Board ChangesBusiness Operations and Strategy
Norfolk Southern Appoints Richard Anderson as New Chair
Positive
Jun 13, 2025

On June 12, 2025, Norfolk Southern Corporation announced the election of Richard H. Anderson as the new Chair of the Board, following the resignation of Claude Mongeau on June 2, 2025. Anderson, with a background as CEO of Delta Air Lines and Amtrak, has been on the board since May 2024 and will also chair the Executive and Strategy & Planning Committees. The board size was reduced to 12 members, and Jack Huffard was appointed as chair of the Compensation and Talent Management Committee. This leadership change is expected to continue driving Norfolk Southern’s strategic priorities and enhance value for shareholders, customers, and 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.

Executive/Board Changes
Norfolk Southern Board Chair Claude Mongeau Resigns
Neutral
Jun 3, 2025

On June 2, 2025, Claude Mongeau resigned as Chair of Norfolk Southern‘s Board of Directors for personal reasons. Mongeau, who has been with the board since September 2019 and served as chair since May 2024, was praised for his leadership during challenging times and for strengthening the company. The board plans to appoint a new chair at its next meeting later in June 2025.

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.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 14, 2025