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Norfolk Southern Corp NSC

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Morningstar’s Analysis

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Carloads Hit by Labor Constraints in Norfolk Southern’s Q4, but Rates Strong and Outlook Favorable

Matthew Young, CFA Equity Analyst

Analyst Note

| Matthew Young, CFA |

Norfolk Southern’s fourth-quarter revenue grew 11% year over year (it was up 14% last quarter) on strong revenue per carload gains, though higher fuel surcharges also contributed. Revenue modestly exceeded our expectations on stronger-than-expected yield improvement, which more than offset disappointing volumes. Along those lines, core pricing continues to enjoy tailwinds from unusually tight capacity across most transportation modes, lifting CSX’s pricing power--average revenue per carload rose 15%.

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Company Profile

Business Description

Class-I railroad Norfolk Southern operates in the Eastern United States. On roughly 21,000 miles of track, the firm hauls shipments of coal (15% of 2019 revenue), intermodal traffic (25%), and a diverse mix of automobile, agriculture, metal, chemical, and forest products.

Contact
Three Commercial Place
Norfolk, VA, 23510-2191
T +1 757 629-2680
Sector Industrials
Industry Railroads
Most Recent Earnings Sep 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type Cyclical
Employees 20,156

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