Norfolk Southern Corporation (NSC)
Debt-to-equity ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 12,781,000 | 12,733,000 | 13,641,000 | 14,791,000 | 15,184,000 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $—K ÷ $12,781,000K
= 0.00
The debt-to-equity ratio of Norfolk Southern Corp. has been showing an increasing trend over the past five years, indicating a rising reliance on debt to finance its operations and investments relative to shareholders' equity.
From 2019 to 2023, the debt-to-equity ratio increased from 0.80 to 1.34, reflecting a significant rise in the proportion of debt in the company's capital structure. This upward trend suggests that Norfolk Southern Corp. has been taking on more debt compared to its equity to fund its growth and expansion activities.
While a higher debt-to-equity ratio can magnify returns on equity in a growing market environment, it also exposes the company to greater financial risk, especially in times of economic downturn or rising interest rates. Investors and creditors typically scrutinize this ratio to assess the company's financial health and leverage levels.
In conclusion, the escalating debt-to-equity ratio of Norfolk Southern Corp. implies a more leveraged position, which may warrant close monitoring to ensure the company's financial stability and ability to meet its debt obligations in the long run.
Peer comparison
Dec 31, 2023