Norfolk Southern (NYSE:NSC) Q3 2020 Earnings Prep

in EARNINGS/INVESTING IDEAS by

Norfolk Southern Corporation (NYSE:NSC) is scheduled to report Q3 earnings results on October 28, 2020.

The company is expected to report earnings of $2.37/share on revenue of $2.511 billion. The consensus earnings per share (EPS) of $2.37/share is based on a poll of 27 analysts and represents a decline in eps of −8.1% over the same quarter last year, when the company reported earnings of $2.58/share.

The revenue forecast of $2.511 billion based on a poll of 18 analysts implies a year-over-year (YoY) decline in revenue of −11.6%. Last year the company reported $2.841 billion in revenue for the quarter.

Expected to report EPS contraction of −8.1% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $2,511.30 $2,841.00 −11.6%
EPS $2.37 $2.58 −8.1%

Earnings Call Trends

Historically, management has exceeded analyst expectations 6 out of the last 8 tracked quarters, and missed expectations 2 quarters.

What are your expectations from Norfolk Southern Corporation for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $1.36 $1.53 12.3% Beat
Q1, 2020 $2.24 $2.58 15.0% Beat
Q4, 2019 $2.28 $2.55 12.0% Beat
Q3, 2019 $2.59 $2.58 −0.5% Missed
Q2, 2019 $2.79 $2.70 −3.2% Missed
Q1, 2019 $2.18 $2.51 15.1% Beat
Q4, 2018 $2.28 $2.57 12.5% Beat
Q3, 2018 $2.44 $2.52 3.2% Beat

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price reacted by increasing 2.0%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
July 29, 2020 $185.10 $188.87 2.0% Increase
April 29, 2020 $170.64 $171.10 0.3% Increase
January 29, 2020 $204.76 $214.50 4.8% Increase
October 23, 2019 $188.96 $183.18 −3.1% Decline

Fundamentals And Technical Analysis

Norfolk Southern Corporation is currently trading at $215.87/share, up 1.0% for the day. The company is trading at approximately 95.9% of its 52-week high of $224.99/share. The company’s stock price is up 14.3% since the last earnings report and down −0.7% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 52.35 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:NSC Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 26.31 and a forward P/E multiple of 23.74.

Norfolk Southern Corporation’s current share price also implies a price-to-book (P/B) multiple of 3.71. The following table summarizes some other key fundamental ratios:

Data as of October 21, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $215.87
P/E Ratio 26.3x
P/E Ratio (Fwd) 23.7x
PEG Ratio −1.2
Total Debt / Total Capital 19.2%
Levered Free Cash Flow $1.923 billion
EV / EBITDA 13.3x

Finbox

Norfolk Southern Corporation is a large-cap stock with a market capitalization of $55.07 billion and a total enterprise value of $66.904 billion. The company operates in the Industrials sector and the Road & Rail industry.

Norfolk 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 industrial products, including chemicals, agriculture, and metals and construction materials; and coal, automobiles, and automotive parts. It also transports overseas freight through various Atlantic and Gulf Coast ports; and provides commuter passenger services. As of December 31, 2019, the company operated approximately 19,500 route miles in 22 states and the District of Columbia. Norfolk Southern Corporation was incorporated in 1980 and is based in Norfolk, Virginia.

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