NEW YORK ( TheStreet) -- Norfolk Southern Corporation (NYSE: NSC) has been reitereated by TheStreet Ratings as a buy with a ratings score of A. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, revenue growth, notable return on equity and attractive valuation levels. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself. Highlights from the ratings report include:
- NORFOLK SOUTHERN CORP has improved earnings per share by 36.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, NORFOLK SOUTHERN CORP increased its bottom line by earning $5.47 versus $4.00 in the prior year. This year, the market expects an improvement in earnings ($5.84 versus $5.47).
- The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Road & Rail industry average. The net income increased by 26.1% when compared to the same quarter one year prior, rising from $325.00 million to $410.00 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 12.4%. Since the same quarter one year prior, revenues slightly increased by 6.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Road & Rail industry and the overall market, NORFOLK SOUTHERN CORP's return on equity exceeds that of both the industry average and the S&P 500.
--Written by a member of TheStreet Ratings Staff.TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.