Norfolk Southern Earnings: Revenue Falls After Four Straight Increases, Net Income Drops

S&P 500 (NYSE:SPY) component Norfolk Southern Corporation (NYSE:NSC) reported its results for the third quarter. Norfolk Southern is engaged in rail transportation of raw materials, intermediate products, and finished goods.

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Norfolk Southern Corporation Earnings Cheat Sheet

Results: Net income for Norfolk Southern Corporation fell to $402 million ($1.24 per share) vs. $554 million ($1.59 per share) a year earlier. This is a decline of 27.4% from the year-earlier quarter.

Revenue: Fell 6.8% to $2.69 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Norfolk Southern Corporation was about in line with expectations as the mean analyst estimate of $1.23 per share. It fell short of the average revenue estimate of $2.95 billion.

Quoting Management: “Third-quarter results reflect weak market conditions, which resulted in declines in our coal and merchandise shipments,” said Norfolk Southern CEO Wick Moorman. “We remain focused on controlling costs while continuing to provide high service levels for our customers and invest in projects that will support future growth.”

Key Stats:

A year-over-year revenue decrease last quarter snaps a streak of four consecutive quarters of revenue increases. The best quarter in that span was the third quarter of the last fiscal year, which saw revenue rise 17.6%.

The company has now seen net income fall in each of the last two quarters. In the second quarter, net income fell 5.9% from the year-earlier quarter.

The company has now topped analyst estimates for the last three quarters. It beat the mark by 7 cents in the second quarter and by 11 cents in the first quarter.

Looking Forward: Over the past sixty days, the outlook for the company’s performance next quarter has become increasingly unfavorable. The average estimate for the fourth quarter is $1.34 per share, a drop from $1.51. The average estimate for the fiscal year is now $5.43 per share, down from $5.98 sixty days ago.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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