Norfolk Southern Corporation NSC
Norfolk Southern's operating recovery is gaining traction—operating margin has rebounded from 23.10% in 2023 to 32.91% in 2025 with EPS up 10.2% YoY to $12.75—and the stock's bullish technical setup (trading above both the 50-day MA at $332.37 and the 200-day MA at $307.74 with a positive MACD histogram of 0.35) confirms building momentum. The proposed $85B Union Pacific merger, now under active STB review with the railroads forcefully rebutting opponents' prima facie challenges on August 26, provides material upside optionality not fully captured at 29.75x earnings.
Smart money positioning turned positive at 0.1021 as of Q2 2026, up from 0.0266 in Q1, and operating margin at 32.91% still sits below the 37.14% and 39.18% achieved in 2022 and 2021, suggesting the margin recovery story has further runway.
What could go wrong
- STB merger rejection. The STB could block or impose onerous conditions on the $85B Union Pacific merger, removing the key catalyst and likely triggering a sharp re-rating lower.
- Valuation premium. At 29.75x earnings, NSC trades at an 8% premium to the peer median of 27.54x, leaving limited margin of safety if growth or merger progress disappoints.
- Revenue stagnation. Revenue growth of just 0.47% YoY in 2025 after contractions in 2023 indicates persistent top-line weakness that could cap further margin expansion.
- Insider net selling. Over the trailing 24 months, insider net value is -$2.68M despite net share accumulation of 37,446 shares, suggesting executives are monetizing at higher prices even as share counts rise from equity grants.
What would change my mind
Where this comes from: derived_metrics FY2023 and FY2025 · derived_metrics and fundamentals FY2025 · technicals as of 2026-08-28 · Reuters news 2026-08-18. Orin's read on NSC; not advice.
Twelve months actual closes to 2026-09-23 · actual filings
50-day average 200-day average · volume below
On file
All NSC filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Vanguard Capital Management | $4.6B | 0.1% of fund |
| State Street | $3.2B | 0.1% of fund |
| Vanguard Portfolio Management | $2.3B | 0.1% of fund |
| Millennium Management | $1.6B | 0.6% of fund |
| Geode Capital Management | $1.6B | 0.1% of fund |
| Bank Of America /De/ | $979.0M | 0.1% of fund |
127 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 199 Form 4 filings, net −$3.0M. Of the 50 on hand, none was an open-market trade— the rest are grants, option exercises and tax withholding.
Ask Orin about NSC
Orin answers questions about NSC from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 26.9× | 22.6× | 44.5× |
| EV/EBITDA | 15.9× | 13.8× | — |
| P/S | 5.64× | 4.54× | — |
| P/B | 4.4× | 4.2× | — |
Its P/E sits 80th percentile of its own last 5 years (+1.01σ from its own mean).
14.4%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $2.2B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$368
$355 – $400 · +17% against today's price
- 21 buy or overweight
- 24 hold
- 3 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| NSCNorfolk Southern Corporation | $71B | 26.9× | 15.9× | 53.7% | 21.0% | 17% |
| CMICummins Inc. | $72B | 26.7× | 15.6× | 25.3% | 7.8% | 22% |
| CSXCSX Corporation | $87B | 27.3× | 15.8× | 54.9% | 22.2% | 24% |
| FDXFedEx Corporation | $69B | 15.9× | 9.3× | 22.9% | 4.7% | 15% |
| ITWIllinois Tool Works Inc. | $79B | 24.7× | 18.9× | 44.2% | 19.4% | 102% |
| PCARPACCAR Inc | $59B | 23.5× | 19.1× | 14.9% | 9.2% | 13% |
| PWRQuanta Services, Inc. | $95B | 71.8× | 33.5× | 14.4% | 4.1% | 15% |
| RSGRepublic Services, Inc. | $66B | 30.2× | 14.2× | 39.1% | 12.9% | 18% |
| URIUnited Rentals, Inc. | $64B | 24.9× | 11.8× | 37.1% | 15.7% | 29% |
The median is of the 8 peers listed above and nothing else — check it against the column. This company trades 4.2% above it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Discounted cash flow
| Model | Fair value | Against | Computed |
|---|---|---|---|
| Standard DCF | $132 | $310.52 · −57% | 2026-06-10 |
| Levered DCF | $64 | $310.52 · −79% | 2026-06-10 |
The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.