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What's in Store for Norfolk Southern (NSC) in Q1 Earnings?
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Norfolk Southern Corporation (NSC - Free Report) is scheduled to report first-quarter 2023 results on Apr 26, before market open.
NSC has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average beat being 3.48%. However, the story may be different in first-quarter 2023. The Zacks Consensus Estimate for the March-end quarter's bottom line has been revised 2.45% downward over the past 60 days.
Let’s have a look at the factors that are likely to have affected NSC’s performance in the quarter under review.
We expect high operating expenses to have dented NSC’s bottom line in the to-be-reported quarter. High fuel costs (our estimate indicates a 17.8% increase from first-quarter 2022 actuals) are likely to have resulted in high operating costs.
Supply-chain disruptions and slower network velocity are expected to have weighed on volumes in the to-be-reported quarter. Notably, the Zacks Consensus Estimate for carloads indicates a 1% decline from the fourth-quarter 2022 actuals. Due to high costs, the operating ratio (operating expenses as a percentage of the total revenues) is likely to have deteriorated in the quarter to be reported.
On a brighter note, coal revenues are likely to have been impressive. The Zacks Consensus Estimate for coal revenues indicates a 2.6% improvement from the first-quarter 2022 actuals.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Norfolk Southern this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Norfolk Southern has an Earnings ESP of -2.12% and a Zacks Rank #3.
Stocks to Consider
Here are a few stocks from the broader Zacks Transportation sector that investors may consider, as our model shows that these have the right combination of elements to beat on earnings this time around.
Canadian National Railway Company (CNI - Free Report) currently has an Earnings ESP of +1.72% and a Zacks Rank #3. It will release first-quarter 2023 results on Apr 24.
The company delivered a trailing four-quarter earnings surprise of 3.5%, on average. The Zacks Consensus Estimate for CNI’s first-quarter 2023 earnings has gained 18.3% year over year.
Copa Holdings (CPA - Free Report) has an Earnings ESP of +13.66% and presently flaunts sports a Zacks Rank #1. It will release first-quarter 2023 results on May 10.
The Zacks Consensus Estimate for CPA’s first-quarter 2023 earnings has improved more than 100% year over year.
Image: Bigstock
What's in Store for Norfolk Southern (NSC) in Q1 Earnings?
Norfolk Southern Corporation (NSC - Free Report) is scheduled to report first-quarter 2023 results on Apr 26, before market open.
NSC has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average beat being 3.48%. However, the story may be different in first-quarter 2023. The Zacks Consensus Estimate for the March-end quarter's bottom line has been revised 2.45% downward over the past 60 days.
Let’s have a look at the factors that are likely to have affected NSC’s performance in the quarter under review.
We expect high operating expenses to have dented NSC’s bottom line in the to-be-reported quarter. High fuel costs (our estimate indicates a 17.8% increase from first-quarter 2022 actuals) are likely to have resulted in high operating costs.
Supply-chain disruptions and slower network velocity are expected to have weighed on volumes in the to-be-reported quarter. Notably, the Zacks Consensus Estimate for carloads indicates a 1% decline from the fourth-quarter 2022 actuals. Due to high costs, the operating ratio (operating expenses as a percentage of the total revenues) is likely to have deteriorated in the quarter to be reported.
On a brighter note, coal revenues are likely to have been impressive. The Zacks Consensus Estimate for coal revenues indicates a 2.6% improvement from the first-quarter 2022 actuals.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Norfolk Southern this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Norfolk Southern has an Earnings ESP of -2.12% and a Zacks Rank #3.
Stocks to Consider
Here are a few stocks from the broader Zacks Transportation sector that investors may consider, as our model shows that these have the right combination of elements to beat on earnings this time around.
Canadian National Railway Company (CNI - Free Report) currently has an Earnings ESP of +1.72% and a Zacks Rank #3. It will release first-quarter 2023 results on Apr 24.
You can see the complete list of today’s Zacks #1 Rank stocks here.
The company delivered a trailing four-quarter earnings surprise of 3.5%, on average. The Zacks Consensus Estimate for CNI’s first-quarter 2023 earnings has gained 18.3% year over year.
Copa Holdings (CPA - Free Report) has an Earnings ESP of +13.66% and presently flaunts sports a Zacks Rank #1. It will release first-quarter 2023 results on May 10.
The Zacks Consensus Estimate for CPA’s first-quarter 2023 earnings has improved more than 100% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.