We publish no single base value for Norfolk Southern. Our valuation methods put it between $126.75 and $195.98 a share. The valuation code's reason: no point fair value: the two anchors behind it compound the same growth rate and differ only in how they end — a perpetuity at the terminal rate against a multiple on the final year — so the midpoint between them measures terminal treatment rather than what the business is worth. The published range is the same reading with the false precision removed: read it as the span the method supports, and treat neither edge as a point estimate.
| Method | Value | vs price | Basis |
|---|---|---|---|
| Discounted cash flow | $126.75 | -62.0% | free cash flow $1.65bn, growth 5.99% for 5 years, then fading to 3% over 5 more, discounted at 10.08%; stress floor $82.94 |
| Exit multiple (P/E) | $195.98 | -41.2% | earnings per share $13.06 valued at 19.16× (the stock's own median P/E) in 5 years, discounted back |
| Sum of the parts | — | — | no sum of the parts: this run holds no segment disclosure for the name |
| Price to sales | — | — | not reached: the cash-flow or earnings methods produced an anchor, so this fallback was not run |
| Tangible book | — | — | used only for lenders, where book value is the business |
| Price to FFO (REITs) | — | — | used only for REITs |
Each working is rebuilt by code from the valuation's own figures and checked against the published value.
The discount rate:
| Risk-free rate | 5.13% (10-year US Treasury yield) |
| Company's own beta | 1.20 (5 years of monthly returns against the S&P 500; standard error 0.17) |
| Peer beta | 1.01 (median of 79 S&P 500 Industrials companies) |
| Blend of own and peers | 1.16 (78% own, 22% peers, weighted by how precisely the company's own beta is measured) |
| Adjusted beta | 1.10 (0.67 × 1.16 + 0.33, pulled toward the market's 1.0) |
| Equity risk premium | 4.5% |
| Discount rate = risk-free + adjusted beta × premium | 10.08% |
Free cash flow grows 5.99% a year for 5 years, then fades in equal steps toward 3% over 5 more; each year is discounted by 1 ÷ (1 + rate)^year:
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Now | — | $1.65bn | — | — |
| Year 1 | 5.99% | $1.75bn | 0.9084 | $1.59bn |
| Year 2 | 5.99% | $1.85bn | 0.8252 | $1.53bn |
| Year 3 | 5.99% | $1.96bn | 0.7497 | $1.47bn |
| Year 4 | 5.99% | $2.08bn | 0.6810 | $1.42bn |
| Year 5 | 5.99% | $2.20bn | 0.6187 | $1.36bn |
| Year 6 | 5.49% | $2.32bn | 0.5620 | $1.31bn |
| Year 7 | 4.99% | $2.44bn | 0.5106 | $1.25bn |
| Year 8 | 4.50% | $2.55bn | 0.4638 | $1.18bn |
| Year 9 | 4.00% | $2.65bn | 0.4213 | $1.12bn |
| Year 10 | 3.50% | $2.74bn | 0.3828 | $1.05bn |
| Terminal value = year-10 cash flow × (1 + 3%) ÷ (10.08% − 3%) | $39.93bn |
| Terminal value in today's money | $15.28bn |
| Present value of years 1–10 | $13.26bn |
| Total present value | $28.54bn |
| Shares outstanding | 225.20m |
| Value per share = total ÷ shares | $126.75 |
How the DCF value moves with the discount rate and the starting growth (the middle cell is the published value):
| Discount rate | Growth 0.99% | Growth 5.99% | Growth 10.99% |
|---|---|---|---|
| 9.08% | $109.72 | $148.31 | — |
| 10.08% | $94.55 | $126.75 | — |
| 11.08% | $83.12 | $110.56 | — |
The same DCF at each beta, starting growth unchanged:
| Beta | Value | Discount rate | DCF value |
|---|---|---|---|
| Company's own beta | 1.20 | 10.53% | $118.93 |
| Peer beta | 1.01 | 9.68% | $134.70 |
| Adjusted beta (used) | 1.10 | 10.08% | $126.75 |
Earnings per share grow on the same fading path as the DCF:
| Year | Growth | Earnings per share |
|---|---|---|
| Now | — | $13.06 |
| Year 1 | 5.99% | $13.85 |
| Year 2 | 5.24% | $14.57 |
| Year 3 | 4.68% | $15.26 |
| Year 4 | 4.26% | $15.91 |
| Year 5 | 3.95% | $16.53 |
| Earnings per share in year 5 | $16.53 |
| Exit P/E (the stock's own median P/E) | 19.16× |
| Value in 5 years = earnings × P/E | $316.78 |
| Discounted at 10.08% over 5 years: ÷ 1.6164 | $195.98 |
We publish no single base value for Norfolk Southern. Our valuation methods put it between $126.75 and $195.98 a share. The valuation code's reason: no point fair value: the two anchors behind it compound the same growth rate and differ only in how they end — a perpetuity at the terminal rate against a multiple on the final year — so the midpoint between them measures terminal treatment rather than what the business is worth. The published range is the same reading with the false precision removed: read it as the span the method supports, and treat neither edge as a point estimate.
One-year price simulation: a 10% chance the price is below $275.94 and a 10% chance it is above $470.09 in a year; a 65% chance it is higher than today's $333.24, from 20.68% volatility. The simulation assumes the price drifts up at our discount rate of 10.08% a year.
At $333.24 the price implies free cash flow growing 22.9% a year for five years and then fading toward 3% over five more; its revenue has grown 6.0%.
| Week | Price | Base value |
|---|---|---|
| 2 Oct 2026 | $317.44 | — |
| 9 Oct 2026 | $317.79 | — |
| 16 Oct 2026 | $326.92 | — |
| 23 Oct 2026 | $329.99 | — |
| 30 Oct 2026 | $342.64 | — |
| 6 Nov 2026 | $319.94 | — |
| 12 Nov 2026 | $333.24 | — |
Data as of 12 Nov 2026; financials to 30 Sep 2026. Sources: company filings via EODHD, SEC EDGAR, US Treasury. How these values are computed. Not investment advice.
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