Chart Says Norfolk Southern Will Keep Chugging Higher

by Sam Collins | April 17, 2014 1:42 am

Norfolk Southern Corp. (NSC[1]) — This rail transportation company and its subsidiaries engage in the movement of raw materials, intermediate products and finished goods that represent a broad cross-section of the economy. It transports these products and raw materials over 20,000 route miles in 22 states and Canada. 

The consensus earnings estimate for 2014 is $6.29 per share, and analysts expect $7.22 in 2015. S&P is more optimistic, expecting profit margins to increase thanks to stiffer cost controls and more fuel-efficient locomotives. It anticipates operating EPS of $6.44 for 2014 and $7.10 for 2015. NSC pays an annual dividend of $2.16 per share for a 2.3% yield.

In October, the stock jumped from a modest uptrend channel and established a new bull channel with support at its 50-day moving average, now at $94.36. On Wednesday, it flashed a buy signal from our internal indicator, the Collins-Bollinger Reversal (CBR), just below the bullish support line of the channel.

NSC closed above its 50-day moving average, helped by a buy signal from the stochastic indicator. The trading target is $104, which also happens to be the consensus mean target.

NSC Chart
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