Norfolk Southern Corp

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NSC : NYSE : Services
$90.14 | %
Today's Range: 0.00 - 0.00
Avg. Daily Volume: 1,618,700
07/27/16 - 4:02 PM ET

Financial Analysis


NORFOLK SOUTHERN CORP's gross profit margin for the first quarter of its fiscal year 2016 has increased when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. NORFOLK SOUTHERN CORP has weak liquidity. Currently, the Quick Ratio is 0.85 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has remained unchanged from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY16 Q1 FY15
Net Sales ($mil)2420.02567.0
EBITDA ($mil)975.0851.0
EBIT ($mil)723.0606.0
Net Income ($mil)387.0310.0


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)589.0524.0
Total Assets ($mil)33785.032775.0
Total Debt ($mil)9498.09210.0
Equity ($mil)12223.012158.0


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin40.2933.15
EBITDA Margin40.2833.15
Operating Margin29.8823.61
Sales Turnover0.310.35
Return on Assets4.835.92
Return on Equity13.3615.97
Debt Q1 FY16 Q1 FY15
Current Ratio1.071.01
Debt/Capital0.440.43
Interest Expense139.0132.0
Interest Coverage5.24.59


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)295.74304.85
Div / share0.590.59
EPS1.291.0
Book value / share41.3339.88
Institutional Own % n/a n/a
Avg Daily Volume1733316.01890294.0

Valuation


BUY. This stock's P/E ratio indicates a premium compared to an average of 16.66 for the Road & Rail industry and a discount compared to the S&P 500 average of 25.05. For additional comparison, its price-to-book ratio of 2.22 indicates a discount versus the S&P 500 average of 2.81 and a discount versus the industry average of 3.44. The current price-to-sales ratio is well above the S&P 500 average, but below the industry average.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
NSC 16.99 Peers 16.66   NSC 8.60 Peers 9.36

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

NSC is trading at a valuation on par with its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

NSC is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
NSC 14.94 Peers 18.79   NSC 2.17 Peers 6.45

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

NSC is trading at a discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

NSC trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
NSC 2.22 Peers 3.44   NSC -13.35 Peers 2.78

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

NSC is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, NSC is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
NSC 2.61 Peers 3.09   NSC -9.90 Peers -5.88

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

NSC is trading at a discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

NSC significantly trails its peers on the basis of sales growth

 

 

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