Norfolk Southern Corporation (NSC) Shares Might Be Overheated

On December 03, 2019, Norfolk Southern Corporation (NYSE:NSC) shares lost -2.03% or -3.86 points to close at $186.21 with a heavy trading volume of 3.36 million shares. It opened the trading session at $186.87, the shares rose to $188.1 and dropped to $185.01, the range by which the price of stock traded the whole day. The company now has a market cap of $49.1 billion and currently has 263.77 million outstanding shares. Norfolk Southern Corporation (NSC) stock has plunged -1.95 percent of market value in 21 trading days.

NSC stock’s trailing 3-year beta is 1.38, meaning there will be a greater rate of return, although posing a higher risk. The part of a firm’s profit given to each outstanding share of regular stock was $10.27 share in the trailing 52 weeks. The stock’s value surged 24.52 percent year to date (YTD) compared to a rise of 9.06 percent in 52 week’s period. The firm’s shares are still trading -11.94 percent below its 1-year high of $211.46 and 34.3 percent up from 52-week low of $138.65. The average consensus ranking on the company is 2.4, on a ranging where 5 is equal to a consensus sell rating. In other words, the mean analyst recommendations are ranking this stock as a sell.

Norfolk Southern Corporation (NSC) is most likely going to rise 9.45 percent in the coming 12 months, as per price target approximations compiled by finviz. Nevertheless, they have set the price target at a $234-month high price target. This represents a whopping 25.66 percent increase from the current trading of shares. The 52-week median price target given by the analysts is $210, which means a return possibility of 12.78 percent in comparison with the closing price of the stock of $186.21 on December 03. The lowest price set for the stock is $127 — just above -31.8 percent from NSC share price now.

Let’s take a glimpse at some insider activity at Norfolk Southern Corporation (NYSE:NSC) and observe the pattern. The earliest insider trade happened on 07/29/2019. Scanlon Jennifer F. gathered a total of 0.53 thousand shares of the firm at average share price of $191.52. The total amount for the purchase was set at $100.55 thousand. On completing this exchange, the Director account balance was 0.53 thousand shares. The stock lost -2.77 percent from that insider purchase. On 05/21/2019, Squires James A, Chairman, President and CEO, did a sale of 3.02 thousand shares at a price of $204.71 per share. This got rid of 619.04 thousand shares from the insider’s fortune and the stock experienced a -9.04 percent retreat in price since the news became public. This exchange saw 125.1 thousand shares get out from the Chairman, President and CEO account.

On 05/03/2019, EVP & COO Wheeler Michael Joseph recorded a sale transaction valued at $511.43 thousand. The sale at $204.57 a share has eliminated 2.5 thousand shares from the insider’s portfolio position. Meanwhile, shares price witnessed -8.97 percent decrease since the transaction reporting date. The company insider is left with 12.95 thousand shares remaining in the account. Zampi Jason Andrew, who works as Vice President and Controller at the company, performed a sale of 0.52 thousand shares in a transaction worth $94.12 thousand. The disposal recorded on 02/14/2019 was priced at $181.34 per share. The stock price soared 2.69 percent since the transaction. Zampi Jason Andrew currently holds a stake of 0 thousand in NSC stock which is worth $0 thousand after the insider selling.

The stock is lingering around the initial support level of $184.78. After this, the following support is at the zone of $183.35. Up until the time the NSC stock hit levels beyond the current one, bulls should have no alarm. In terms of its momentum, the stock’s RSI hit 44.11 on the daily chart, and this may be a cause for concern. In case the price goes below $183.35 level on closing basis, there may be more profit booking with the stock growing weaker. Still, getting to the $187.87 level may cause a pull-back move approaching $189.53 mark.

Norfolk Southern Corporation (NSC) shares are trading at a P/E ratio of 18.1 times earnings posted in the trailing 12 months. The industry NSC deals with has an average P/E of 19.2. Its P/B ratio is standing at 3.2X compared to the 4.1 industry average. It is additionally sporting a 4.3 on the Price-to-Sales ratio, compared to the industry’s P/S average of 4.4. Norfolk Southern Corporation has a 48.2% gross profit margin, with its operating margin around 35.7%. Alongside this, the company’s net profit margin currently stands at 23.9%.