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Norfolk Southern (NSC) Q3 Earnings & Revenues Beat, Up Y/Y

Norfolk Southern CorporationNSC reported third-quarter 2018 earnings of $2.52 per share, surpassing the Zacks Consensus Estimate of $2.44. The bottom line also improved 44% on a year-over-year basis. Results were aided by a low effective tax rate among other factors.

Railway operating revenues in the quarter under review grossed $2,947 million, above the Zacks Consensus Estimate of $2,904.3 million. The top line also rose 10.4% on a year-over-year basis. Overall, volumes expanded 5% on the back of growth across all three segments.

Income from railway operations rose 14% year over year to $1 billion. Operating expenses increased 9% year over year to $1.9 billion. Railway operating expenses rose due to higher fuel prices and volume-related expenses as well as costs associated with overall lower network velocity.

Norfolk Southern's operating ratio (operating expenses as a percentage of revenues) in the third quarter of 2018 came in at 65.4% compared with 66.5% in the third quarter of 2017. The strong earnings report pleased investors. Consequently, the stock gained in early trading.

Norfolk Southern Corporation Price, Consensus and EPS Surprise

Norfolk Southern Corporation Price, Consensus and EPS Surprise | Norfolk Southern Corporation Quote

Segmental Revenues

On a year-over-year basis, coal revenues increased 3% to $464 million. Coal volumes declined 4%.

Merchandise revenues gained 9% year over year to $1,737 million. Merchandise volumes improved 3%.

Intermodal revenues rose 20% year over year to $746 million. Intermodal volumes improved 8%.

Liquidity

This Zacks Rank #2 (Buy) company exited the third quarter with cash and cash equivalents of $729 million compared with $690 million at the end of 2017. The company had long-term debt of $10,635 million compared with $9,136 million as of Dec 31, 2017. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

Upcoming Releases

Investors interested in the broader Transportation Sector are awaiting third-quarter 2018 earnings reports from key players, namely Southwest Airlines Co. LUV , Union Pacific Corporation UNP and Alaska Air Group, Inc. ALK . All the stocks are scheduled to release results on Oct 25.

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Norfolk Southern Corporation (NSC): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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