Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Norfolk Southern Corp. (NYSE:NSC)

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Analysis of Income Taxes

Advanced level

Income Tax Expense (Benefit)

Norfolk Southern Corp., income tax expense (benefit), continuing operations

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended: Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Federal
State
Current taxes
Federal
State
Deferred taxes
Income taxes

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-05), 10-K (filing date: 2017-02-06).

Item Description The company
Current taxes Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations. Norfolk Southern Corp.’s current taxes decreased from 2018 to 2019 and from 2019 to 2020.
Deferred taxes Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations. Norfolk Southern Corp.’s deferred taxes increased from 2018 to 2019 but then decreased significantly from 2019 to 2020.
Income taxes Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Norfolk Southern Corp.’s income taxes decreased from 2018 to 2019 and from 2019 to 2020.

Effective Income Tax Rate (EITR)

Norfolk Southern Corp., effective income tax rate (EITR) reconciliation

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Federal income tax statutory rate
State income taxes, net of federal tax effect
Excess tax benefits on stock-based compensation
Other, net
Effective income tax rate, before tax reform
Equity in earnings related to tax reform
Tax reform
Effective income tax rate

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-05), 10-K (filing date: 2017-02-06).

Item Description The company
Effective income tax rate, before tax reform Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Norfolk Southern Corp.’s effective income tax rate, before tax reform decreased from 2018 to 2019 and from 2019 to 2020.

Components of Deferred Tax Assets and Liabilities

Norfolk Southern Corp., components of deferred tax assets and liabilities

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Compensation and benefits, including postretirement benefits
Accruals, including casualty and other claims
Other
Gross deferred tax assets
Valuation allowance
Net deferred tax assets
Property
Other
Deferred tax liabilities
Deferred income taxes

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-05), 10-K (filing date: 2017-02-06).

Item Description The company
Gross deferred tax assets Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Norfolk Southern Corp.’s gross deferred tax assets increased from 2018 to 2019 but then slightly decreased from 2019 to 2020.
Net deferred tax assets Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Norfolk Southern Corp.’s net deferred tax assets increased from 2018 to 2019 but then slightly decreased from 2019 to 2020.
Deferred income taxes Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting. Norfolk Southern Corp.’s deferred income taxes decreased from 2018 to 2019 and from 2019 to 2020.

Deferred Tax Assets and Liabilities, Classification

Norfolk Southern Corp., deferred tax assets and liabilities, classification

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Net deferred tax liabilities

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-05), 10-K (filing date: 2017-02-06).

Item Description The company
Net deferred tax liabilities Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent. Norfolk Southern Corp.’s net deferred tax liabilities increased from 2018 to 2019 and from 2019 to 2020.

Adjustments to Financial Statements: Removal of Deferred Taxes

Norfolk Southern Corp., adjustments to financial statements

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Adjustment to Total Liabilities
Total liabilities (as reported)
Less: Noncurrent deferred tax liabilities, net
Total liabilities (adjusted)
Adjustment to Stockholders’ Equity
Stockholders’ equity (as reported)
Less: Net deferred tax assets (liabilities)
Stockholders’ equity (adjusted)
Adjustment to Net Income
Net income (as reported)
Add: Deferred income tax expense (benefit)
Net income (adjusted)

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-05), 10-K (filing date: 2017-02-06).


Norfolk Southern Corp., Financial Data: Reported vs. Adjusted


Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Norfolk Southern Corp., adjusted financial ratios

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Net Profit Margin
Reported net profit margin
Adjusted net profit margin
Financial Leverage
Reported financial leverage
Adjusted financial leverage
Return on Equity (ROE)
Reported ROE
Adjusted ROE
Return on Assets (ROA)
Reported ROA
Adjusted ROA

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-05), 10-K (filing date: 2017-02-06).

Financial ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Norfolk Southern Corp.’s adjusted net profit margin ratio improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Norfolk Southern Corp.’s adjusted financial leverage ratio increased from 2018 to 2019 and from 2019 to 2020.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Norfolk Southern Corp.’s adjusted ROE improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Norfolk Southern Corp.’s adjusted ROA improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.

Norfolk Southern Corp., Financial Ratios: Reported vs. Adjusted


Adjusted Net Profit Margin

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
As Reported
Selected Financial Data (US$ in millions)
Net income
Railway operating revenues
Profitability Ratio
Net profit margin1
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income
Railway operating revenues
Profitability Ratio
Adjusted net profit margin2

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-05), 10-K (filing date: 2017-02-06).

2020 Calculations

1 Net profit margin = 100 × Net income ÷ Railway operating revenues
= 100 × ÷ =

2 Adjusted net profit margin = 100 × Adjusted net income ÷ Railway operating revenues
= 100 × ÷ =

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Norfolk Southern Corp.’s adjusted net profit margin ratio improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.

Adjusted Financial Leverage

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
As Reported
Selected Financial Data (US$ in millions)
Total assets
Stockholders’ equity
Solvency Ratio
Financial leverage1
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Total assets
Adjusted stockholders’ equity
Solvency Ratio
Adjusted financial leverage2

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-05), 10-K (filing date: 2017-02-06).

2020 Calculations

1 Financial leverage = Total assets ÷ Stockholders’ equity
= ÷ =

2 Adjusted financial leverage = Total assets ÷ Adjusted stockholders’ equity
= ÷ =

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Norfolk Southern Corp.’s adjusted financial leverage ratio increased from 2018 to 2019 and from 2019 to 2020.

Adjusted Return on Equity (ROE)

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
As Reported
Selected Financial Data (US$ in millions)
Net income
Stockholders’ equity
Profitability Ratio
ROE1
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income
Adjusted stockholders’ equity
Profitability Ratio
Adjusted ROE2

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-05), 10-K (filing date: 2017-02-06).

2020 Calculations

1 ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × ÷ =

2 Adjusted ROE = 100 × Adjusted net income ÷ Adjusted stockholders’ equity
= 100 × ÷ =

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Norfolk Southern Corp.’s adjusted ROE improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.

Adjusted Return on Assets (ROA)

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
As Reported
Selected Financial Data (US$ in millions)
Net income
Total assets
Profitability Ratio
ROA1
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income
Total assets
Profitability Ratio
Adjusted ROA2

Based on: 10-K (filing date: 2021-02-04), 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-05), 10-K (filing date: 2017-02-06).

2020 Calculations

1 ROA = 100 × Net income ÷ Total assets
= 100 × ÷ =

2 Adjusted ROA = 100 × Adjusted net income ÷ Total assets
= 100 × ÷ =

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Norfolk Southern Corp.’s adjusted ROA improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.