Today Norfolk Southern (NSC) Hits New Lifetime High

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Norfolk Southern ( NSC) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Norfolk Southern as such a stock due to the following factors:

  • NSC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $227.6 million.
  • NSC has traded 26,232 shares today.
  • NSC is trading at a new lifetime high.

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More details on NSC:

Norfolk Southern Corporation, together with its subsidiaries, is engaged in the rail transportation of raw materials, intermediate products, and finished goods. As of December 31, 2013, it operated approximately 20,000 miles of road in 22 states and the District of Columbia. The stock currently has a dividend yield of 2.1%. NSC has a PE ratio of 17.0. Currently there are 6 analysts that rate Norfolk Southern a buy, no analysts rate it a sell, and 9 rate it a hold.

The average volume for Norfolk Southern has been 1.8 million shares per day over the past 30 days. Norfolk Southern has a market cap of $33.7 billion and is part of the services sector and transportation industry. The stock has a beta of 0.79 and a short float of 1.5% with 2.55 days to cover. Shares are up 18.3% year-to-date as of the close of trading on Wednesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Norfolk Southern as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, solid stock price performance and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 26.60% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, NSC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • NORFOLK SOUTHERN CORP has improved earnings per share by 17.0% 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 $6.04 versus $5.37 in the prior year. This year, the market expects an improvement in earnings ($6.48 versus $6.04).
  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.3%. Since the same quarter one year prior, revenues slightly increased by 7.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The debt-to-equity ratio is somewhat low, currently at 0.73, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.22, which illustrates the ability to avoid short-term cash problems.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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