Norfolk Southern (NSC) Shares Up 8.1% on Strong Earnings

Norfolk Southern (NYSE:NSC) shares shot up 8.1% during mid-day trading on Wednesday following a stronger than expected earnings report. The stock traded as high as $146.41 and last traded at $145.96. 4,978,730 shares changed hands during mid-day trading, an increase of 167% from the average session volume of 1,861,584 shares. The stock had previously closed at $134.97.

The railroad operator reported $1.93 earnings per share for the quarter, beating the Zacks’ consensus estimate of $1.77 by $0.16. The business had revenue of $2.72 billion during the quarter, compared to analyst estimates of $2.68 billion. Norfolk Southern had a return on equity of 14.16% and a net margin of 51.22%. The company’s revenue was up 5.5% on a year-over-year basis. During the same quarter last year, the business posted $1.48 EPS.

The business also recently disclosed a quarterly dividend, which will be paid on Monday, June 11th. Shareholders of record on Friday, May 4th will be paid a dividend of $0.72 per share. The ex-dividend date of this dividend is Thursday, May 3rd. This represents a $2.88 dividend on an annualized basis and a dividend yield of 1.97%. Norfolk Southern’s payout ratio is currently 43.57%.

A number of research firms have weighed in on NSC. ValuEngine upgraded Norfolk Southern from a “hold” rating to a “buy” rating in a research note on Thursday. Cowen reiterated a “buy” rating and set a $167.00 price objective on shares of Norfolk Southern in a research note on Wednesday. Royal Bank of Canada reiterated a “hold” rating and set a $145.00 price objective on shares of Norfolk Southern in a research note on Tuesday, April 10th. Zacks Investment Research upgraded Norfolk Southern from a “sell” rating to a “hold” rating in a research note on Wednesday, April 4th. Finally, Loop Capital reduced their price objective on Norfolk Southern from $139.00 to $135.00 and set a “sell” rating for the company in a research note on Thursday, March 15th. Three equities research analysts have rated the stock with a sell rating, thirteen have assigned a hold rating and eight have issued a buy rating to the company. The stock currently has a consensus rating of “Hold” and a consensus target price of $140.20.

In related news, Chairman James A. Squires sold 10,000 shares of Norfolk Southern stock in a transaction dated Thursday, February 1st. The stock was sold at an average price of $150.10, for a total value of $1,501,000.00. The transaction was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, VP Thomas E. Hurlbut sold 467 shares of Norfolk Southern stock in a transaction dated Thursday, February 1st. The stock was sold at an average price of $150.17, for a total value of $70,129.39. Following the completion of the sale, the vice president now owns 5,000 shares in the company, valued at $750,850. The disclosure for this sale can be found here. Over the last quarter, insiders sold 13,166 shares of company stock worth $1,958,040. 0.23% of the stock is currently owned by insiders.

A number of hedge funds have recently bought and sold shares of NSC. GSA Capital Partners LLP boosted its holdings in Norfolk Southern by 41.7% in the 3rd quarter. GSA Capital Partners LLP now owns 2,923 shares of the railroad operator’s stock worth $387,000 after buying an additional 860 shares during the last quarter. Prudential Financial Inc. boosted its holdings in Norfolk Southern by 61.2% in the 3rd quarter. Prudential Financial Inc. now owns 1,143,908 shares of the railroad operator’s stock worth $151,270,000 after buying an additional 434,160 shares during the last quarter. Rockland Trust Co. boosted its holdings in Norfolk Southern by 27.7% in the 4th quarter. Rockland Trust Co. now owns 3,476 shares of the railroad operator’s stock worth $504,000 after buying an additional 755 shares during the last quarter. Sawyer & Company Inc acquired a new stake in Norfolk Southern in the 4th quarter worth about $104,000. Finally, Indiana Trust & Investment Management CO acquired a new stake in Norfolk Southern in the 4th quarter worth about $207,000. Institutional investors own 72.29% of the company’s stock.

The company has a debt-to-equity ratio of 0.56, a current ratio of 0.84 and a quick ratio of 0.76. The firm has a market capitalization of $39,123.45, a PE ratio of 22.08, a PEG ratio of 1.37 and a beta of 1.31.

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About Norfolk Southern

Norfolk Southern Corporation, together with its subsidiaries, engages in the rail transportation of raw materials, intermediate products, and finished goods. It also transports overseas freight through various Atlantic and Gulf Coast ports, as well as coal, automotive, and industrial products; and provides commuter passenger services.

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