Norfolk Southern Intrinsic Value – Norfolk Southern Seeks to Expand Investment Opportunities with Mixed Shelf Filing
December 21, 2023
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Norfolk Southern ($NYSE:NSC) is a major freight railroad and transportation company in the United States. The company has recently filed for a mixed shelf registration with the U.S. Securities and Exchange Commission, which will allow them to offer both equity and debt securities in the future. The mixed shelf filing will give Norfolk Southern increased flexibility in exploring new investment opportunities and capital raising strategies. The filing also provides investors with the ability to purchase more of Norfolk Southern’s securities on a discretionary basis. This filing will enable the company to issue a variety of debt and equity securities, including common stock, preferred stock, debt securities, warrants, purchase contracts, and subscription rights. The filing also allows Norfolk Southern to issue securities from time to time in one or more public offerings, as well as to use proceeds from these offerings for general corporate purposes.
By utilizing a mixed shelf filing, Norfolk Southern can open up a wider range of options for themselves and investors. With the ability to offer both equity and debt securities, the company can take advantage of various market opportunities. Furthermore, investors will have increased flexibility in selecting the type of securities that best fits their needs. This filing will provide investors with the convenience of being able to purchase additional securities without having to wait for new offerings. Overall, Norfolk Southern’s mixed shelf filing is an exciting opportunity that can bring great potential benefits to both the company and its investors.
Stock Price
On Wednesday, Norfolk Southern stock opened at $231.4 and closed at $229.8, down by 1.6% from the previous closing price of $233.6. Under the filing, Norfolk Southern has the potential to issue a variety of debt and equity securities, such as bonds, notes, warrants, other debt securities, depositary shares, and common stock for a term of up to three years. The company is able to offer these securities for sale to investors in the public or private markets, in one or more offerings. The mixed shelf filing also enables Norfolk Southern to use the proceeds of the sale for general business purposes such as refinancing, capital expenditures, acquisitions or other similar uses.
This will enable the company to further invest in its operations and expand its opportunities for growth. It will be interesting to see how this filing impacts the company’s overall performance and future success. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Norfolk Southern. More…
| Total Revenues | Net Income | Net Margin |
| 12.32k | 2.09k | 23.9% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Norfolk Southern. More…
| Operations | Investing | Financing |
| 3.3k | -1.94k | -1.07k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Norfolk Southern. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 40.74k | 28.12k | 55.78 |
Key Ratios Snapshot
Some of the financial key ratios for Norfolk Southern are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 7.5% | 6.6% | 27.7% |
| FCF Margin | ROE | ROA |
| 9.3% | 16.9% | 5.2% |
Analysis – Norfolk Southern Intrinsic Value
At GoodWhale, we have analyzed NORFOLK SOUTHERN‘s fundamentals and have determined that the fair value of their stock is around $279.2. This number is based on our proprietary Valuation Line, which takes into account a variety of financial metrics to determine a stock’s worth. Currently, NORFOLK SOUTHERN’s stock is traded at $229.8, which is below its fair value by 17.7%. This presents a potential buying opportunity for savvy investors looking to beat the market. More…
Peers
Norfolk Southern Corp is a publicly traded company on the New York Stock Exchange under the ticker symbol NSC. The company’s headquarters are located in Norfolk, Virginia. Norfolk Southern is one of the largest railroads in the United States. The company operates 19,500 miles of track in 22 states and the District of Columbia. Norfolk Southern employs 28,000 people. The company was founded in 1838.
Norfolk Southern’s main competitors are CSX Corp, Westshore Terminals Investment Corp, Canadian Pacific Railway Ltd.
– CSX Corp ($NASDAQ:CSX)
CSX Corporation is an American publicly traded company that operates as a Class I railroad in the United States. The company’s operating revenues and net income have both grown in recent years, and its market capitalization reached nearly $60 billion by early 2021. The company’s strong financial performance is due in part to its focus on efficiency and cost-cutting measures.
– Westshore Terminals Investment Corp ($TSX:WTE)
Westshore Terminals Investment Corp is a Canadian company that owns and operates a coal terminal on the west coast of Canada. The company has a market cap of 1.56B as of 2022 and a Return on Equity of 13.29%. The company’s terminal is the largest coal export facility in North America and handles nearly 30% of all thermal coal exports from the United States.
– Canadian Pacific Railway Ltd ($TSX:CP)
As of 2022, Canadian Pacific Railway Ltd has a market cap of 90.72B and a Return on Equity of 6.42%. The company operates a transcontinental railway in Canada and the United States, connecting major cities such as Vancouver, Toronto, and Chicago. CP is known for its efficiency and service, and is a major player in the freight transportation industry.
Summary
Norfolk Southern Corporation is a premier transportation company providing rail-based freight and intermodal services to customers across the United States. With a long-term focus on growth and profitability, Norfolk Southern has a strong track record of generating returns for investors. Fundamental analysis of Norfolk Southern’s financials reveals a strong balance sheet, diversified revenue sources, and a large and growing dividend. The company’s operating margin has been consistently high and its long-term debt to equity ratio is at a manageable level. Norfolk Southern has also invested heavily in new technologies and infrastructure to remain competitive in the market.
Additionally, the company has a proven track record of delivering shareholder returns, with a dividend yield of over 3%. As such, Norfolk Southern appears to be an attractive investment option for those seeking long-term capital appreciation and income generation.
