The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Norfolk Southern met expectations on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped and GAAP earnings per share contracted significantly.
Margins contracted across the board.
Norfolk Southern notched revenue of $2.69 billion. The 21 analysts polled by S&P Capital IQ foresaw revenue of $2.72 billion on the same basis. GAAP reported sales were 6.8% lower than the prior-year quarter's $2.89 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $1.24. The 24 earnings estimates compiled by S&P Capital IQ predicted $1.23 per share. GAAP EPS of $1.24 for Q3 were 22% lower than the prior-year quarter's $1.59 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 35.7%, 430 basis points worse than the prior-year quarter. Operating margin was 27.1%, 540 basis points worse than the prior-year quarter. Net margin was 14.9%, 430 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.78 billion. On the bottom line, the average EPS estimate is $1.35.
Next year's average estimate for revenue is $11.16 billion. The average EPS estimate is $5.41.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,147 members out of 1,183 rating the stock outperform, and 36 members rating it underperform. Among 320 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 311 give Norfolk Southern a green thumbs-up, and nine give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Norfolk Southern is outperform, with an average price target of $79.04.
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