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Norfolk Southern Corporation (NSC) is a prominent freight rail holding company in the transportation sector, specializing in railroads. Headquartered in Atlanta, Georgia, the company oversees one of the largest and most efficient rail networks in the eastern United States, with roughly 19,400 route miles across 22 states. It boasts a robust market cap of approximately $64.1 billion.
Shares of Norfolk Southern have surged 21.6% on a year-to-date (YTD) basis, substantially outpacing the S&P 500 Index ($SPX), which has gained around 8.7% YTD. Over the past year, NSC rallied 18.6%, compared to $SPX’s 14.3%.
Zooming in further, the iShares Transportation Average ETF (IYT) gained 4.4% this year and 7.2% over the past 52 weeks, trailing behind NSC’s returns.
One of the most significant catalysts for NSC’s recent performance is the $85 billion merger announcement last month with Union Pacific. This deal, aiming to create America’s first transcontinental railroad, has injected strong momentum into the stock. However, the merger has also introduced regulatory uncertainty and integration risk.
For the current fiscal year, ending in December 2025, analysts expect Norfolk Southern to report EPS growth of 6.3% year-over-year to $12.60, on a diluted basis. The company has a history of surpassing Wall Street’s projections. It topped consensus estimates in three of the last four quarters, while missing on one other occasion.
Meanwhile, NSC has a “Moderate Buy” rating overall from the 23 analysts covering the stock. That’s based on seven “Strong Buys” and 16 “Hold” ratings.
Analysts’ sentiment on NSC stock has shifted subtly in recent months. While bearish pressure eased with no “Strong Sell” ratings now compared to a month ago, optimism has cooled as well. “Strong Buy” calls dropped from 12 to just seven in a month, signaling tempered bullishness. There’s confidence, but not as strong as before.
On July 30, Benchmark downgraded Norfolk Southern from “Buy” to “Hold” after its Q2 earnings miss and amid merger uncertainties.
Meanwhile, the mean price target of $290.35 represents a premium of just 1.7% to NSC’s current price, while the Street-high price target of $332 suggests an upside potential of 16.3%.
On the date of publication, Sristi Jayaswal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
