Norfolk Southern Corporation (NSC)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 3.26 | 3.05 | 2.82 | 2.57 | 2.50 |
Looking at Norfolk Southern Corp.'s solvency ratios over the past five years, we observe a generally increasing trend in debt-related ratios, indicating potentially higher levels of leverage and debt utilization by the company.
The debt-to-assets ratio has shown an upward trend, increasing from 0.32 in 2019 to 0.41 in 2023. This indicates that a larger proportion of Norfolk Southern Corp.'s assets is financed by debt rather than equity.
Similarly, the debt-to-capital ratio has also increased from 0.45 in 2019 to 0.57 in 2023. This suggests that the company has been relying more on debt financing compared to its capital structure over the years.
The debt-to-equity ratio has experienced substantial growth, rising from 0.80 in 2019 to 1.34 in 2023. This escalating trend indicates that Norfolk Southern Corp. has been funding a larger portion of its operations and investments through debt relative to shareholders' equity.
Furthermore, the financial leverage ratio has demonstrated a consistent uptrend, climbing from 2.50 in 2019 to 3.26 in 2023. This ratio signifies the company's reliance on debt to fund its operations and suggests a potential increase in financial risk as higher leverage can magnify the impact of financial downturns.
In conclusion, the solvency ratios of Norfolk Southern Corp. reflect an increasing reliance on debt financing over the years, indicating a potential higher financial risk and leverage for the company. Investors and stakeholders should carefully monitor these trends to assess the company's ability to meet its debt obligations and sustain its operations in the long run.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 4.21 | 6.97 | 7.00 | 5.05 | 6.78 |
Interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio indicates a stronger ability to meet interest obligations.
Looking at Norfolk Southern Corp.'s interest coverage ratio over the past five years, we observe fluctuations but generally consistent performance. The ratio ranged from a low of 5.42 in 2020 to a high of 6.95 in 2022, with the most recent value at 5.49 in 2023.
Overall, the interest coverage ratio for Norfolk Southern Corp. indicates that the company has generally been able to comfortably cover its interest expenses with its operating income over the years, albeit with some fluctuations. Investors and creditors typically prefer to see a stable and robust interest coverage ratio, and it would be important to monitor future trends to ensure the company can continue meeting its interest obligations effectively.