Earnings Preview: Norfolk Southern Corporation

Norfolk Southern Corporation (NSC) is expected to report Q2 earnings Tuesday, July 22, after market close with a conference call scheduled for Wednesday, July 23 at 9:00 a.m. ET.

Guidance

Analysts are looking for EPS of $1.05 on revenue of $2.65B. The consensus range is $1.00 to $1.08 for EPS, and $2.59B to $2.71B for revenue, according to First Call. Norfolk Southern, along with the rest of the rail sector, faced disruptions in their shipping abilities as a result of the flooding in the Midwest U.S., placing enormous stress on the national shipping system. If delays go further it will mean new price increases for a wide range of products.

Analyst Views

Despite struggles, Merrill Lynch upgraded the company to Buy from Neutral in May, based on valuation relative to the rail sector, pricing strength, and favorable commodity mix. Norfolk Southern was also upgraded to Overweight from Neutral at JP Morgan on July 10. The firm based the upgraded on leverage to export coal and the tighter truckload market.