QualityDipStocks / Industrials · Railroads
Norfolk Southern NSC
Not in a dip: trading near its 52-week high.
A quality company trading well above our fair value estimate.
- Fair value est.
- $115.89−66%
- Market Value
- $336.95price +2%
- Off 52-wk high
- −3%
- Risk vs market
- Lowbeta 0.19
4 bullish · 5 bearish See why
Key levels
Every level vs today’s $342.64
- Fair value est.base case$115.89−66.2%
- 52-wk lowlowest close, 1 year$278.19−18.8%
- Market Valueavg paid since Oct 22$336.95−1.7%
- PriceFri Oct 30 close$342.64you are here
- 52-wk highhighest close, 1 year$352.98+3.0%
Fair value estimate
How the range is computed
Ten-year free-cash-flow DCF. Same 10-year free-cash-flow model as the base: discount rate 9.5% ±1 point and growth 3.0% ±2 points. Bear = 10.5% and 1.0%; bull = 8.5% and 5.0% (both fade to 3%). A model estimate from public filings, not a forecast of where the price will go.
Price is above even the bull case.
What the price implies To be worth today’s price, NSC’s free cash flow would need to grow about 23% a year for five years; our estimate uses 3%.
Risk vs market
How risk vs market is measured
One year of daily returns (Oct 30 to Oct 30, 252 sessions). Beta = how much NSC moved for each 1% move in the S&P 500 (SPY); 1.0 moves with the market. Volatility is the yearly standard deviation of daily returns. Past behavior, not a forecast.
Has moved mostly independently of the market, but its own price swings are 1.6× the S&P 500’s (it moves on its own news).
- Beta vs S&P 500
- 0.19
- Volatility
- 21% vs 13% SPY
- Correlation SPY
- 0.12
- Correlation QQQ
- −0.04
Bull vs bear
Rule-based from the data on this page, strongest first. Not advice.
Top bullish points 4 of 5
ProfitabilityOperating margin widened to 35.8% in FY2025 from 23.5% in FY2023 (SEC filings).
ProfitabilityReturn on equity of 17% over the last 12 months, up 4 points in two years.
Cash returnsDividend yield of 1.6%, above the 1.1% median for the 116 Industrials companies we cover.
QualityPasses all four of our quality checks: cash generation, returns on capital, growth and balance sheet.
Top bearish points 5 of 5
ValuationOur DCF fair value estimate is $115.89, 66% below the price.
GrowthSales grew only −1.5% a year from FY2022 to FY2025.
ValuationP/E of 28.8× is 19% above its own average of 24.1× at the last 3 fiscal year-ends.
Cash returnsFree cash flow fell 22% over the last 12 months vs the 12 months before.
ValuationPrice / free cash flow of 47×: a rich price for the cash it generates today.
Who’s talking about it
Notable investors, executives, analysts and public figures on Norfolk Southern in the last 48 hours. Headlines as published, each linked. Their words, not ours.
No notable mentions in the last 48 hours. Checked Nov 1, 9:09 PM ET.
Compare with peers
Closest in size in Railroads
All fundamentals
P/E 28.8 · FCF yield 2.1% · ROE 17%
Valuation
- P/E
- 28.8×3-yr-end avg 24.1× · Industrials median 27.5×
- Price / FCF
- 46.9×
- FCF yield
- 2.1%
- EV / EBITDA
- 16.7×
- Price / sales
- 5.95×
- Price / book
- 4.61×
- Market cap
- $77.2Bprice × diluted shares
- Enterprise value
- $92.2B
Growth
- Revenue, 12 months
- $13.0B
- Sales growth, 12 months
- +6.0%vs the 12 months before
- Sales growth, 3 yrs
- −1.5%/yrfrom FY2022
- Diluted EPS, 12 months
- $11.93
- EPS growth, last FY
- +10.2%
- Net income, 12 months
- $2.7B
- Net income growth
- −9%12 months vs before
Profitability
- Gross margin
- n/agross profit isn't reported (common for service and financial companies)
- Operating margin
- 31.5%
- Net margin
- 20.7%
- FCF margin
- 12.7%
- Return on equity
- 17%
- Return on invested capital
- 10%
Balance sheet
- Cash & short-term inv.
- $1.6B
- Total debt
- $16.6B
- Net cash
- −$15.0B
- Debt / equity
- 0.99×
- Interest coverage
- 5.2×operating income / interest
Cash flow & returns
- Free cash flow, 12 months
- $1.6B
- FCF growth, 12 months
- −22%
- Dividend yield
- 1.57%$1.2B paid
- Payout ratio
- 45%
- Buybacks, 12 months
- $5M0.0% of market cap
- Share count, 1 year
- +0.2%diluted shares vs a year ago
- Stock-based comp
- $83M
Trailing 12 months to Sep 30, 2026; balance sheet at Sep 30, 2026. From Norfolk Southern’s SEC filings. Sparklines show up to six fiscal years. n/a means we don’t hold that number, with the reason. How each is computed.
Valuation details
DCF $115.89 · MV $336.95 · FCF value $183.80
Assumes 3.0% growth for 5 years (revenue grew -1.5% a year FY22–FY25; floored at 3%), fading to 3%; 9.5% discount rate, 3% terminal growth. FCF base $7.31 a share (trailing 12 months to Sep 30, 2026), from the 10-Q filed Oct 22, 2026.
Setup & signals
No setup armed
No setup armed, so there’s no trigger or stop to track yet. Reversal signal rules only arm once a company is in a dip.
Momentum & 52-week range
RSI 67 · 5 days +3.8%
The business
FCF $1.6B · Sales +14%
- Free cash flow, 12 months$1.6B
- Free-cash-flow yield2.1%
- Free-cash-flow margin13%
- Gross margin36%
- Operating margin36%
- Return on invested capital11%
- Return on equity17%
- Sales growth (latest quarter vs year-ago quarter)+14%
- Net debt / EBITDA2.7×
Information only, not investment advice. Fair value estimates and talking points are rule-based model output from public data and can be wrong; stop levels are reference points, not orders. How every number is computed.
Get a text when NSC fires a reversal signal
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