Norfolk Southern Corp. (NYSE:NSC)

Net income

The net income exhibits a fluctuating pattern over the five-year period. It started at a high level in 2017 with 5404 million US dollars, then experienced a significant decline in 2018 to 2666 million. From 2018 to 2019, net income slightly increased to 2722 million. However, it dropped again in 2020 to 2013 million, which is the lowest point in the observed period. In 2021, net income recovered to 3005 million, showing a moderate positive trend but still below the 2017 peak.

Earnings before tax (EBT)

EBT displays a generally positive trajectory with some volatility. Starting at 3128 million in 2017, it increased to 3469 million in 2018 and slightly further to 3491 million in 2019. There was a notable decline in 2020 to 2530 million, aligning with the overall decline observed in net income during that year. However, 2021 saw a significant rebound to 3878 million, surpassing all previous levels in the period.

Earnings before interest and tax (EBIT)

EBIT follows a pattern similar to EBT but at higher absolute values. It rose steadily from 3678 million in 2017 to 4026 million in 2018 and continued to 4095 million in 2019. The year 2020 witnessed a decrease to 3155 million, reflecting the general downturn in earnings. In 2021, EBIT rebounded strongly to 4524 million, the highest among all years considered.

Earnings before interest, tax, depreciation and amortization (EBITDA)

EBITDA shows an overall upward trend with some fluctuations. From 4737 million in 2017, it increased to 5130 million in 2018 and further slightly to 5234 million in 2019. There was a decrease in 2020 to 4309 million, consistent with the pattern of reduced profitability during that year. In 2021, EBITDA rose markedly to 5705 million, exceeding previous highs and indicating improved operational performance.

The financial data reveals several notable trends over the five-year period ending December 31, 2021.

Enterprise Value (EV)

There was a consistent upward trend in enterprise value, increasing from approximately $48.5 billion in 2017 to about $77.8 billion in 2021. This represents an overall growth of roughly 60%, indicating increased market valuation or expansion in the company's operational scale over the timeframe.

Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)

EBITDA showed moderate growth from 2017 through 2019, rising from $4.7 billion to $5.2 billion. However, in 2020, EBITDA experienced a noticeable decline to $4.3 billion, likely reflecting operational challenges or external impacts during that year. In 2021, EBITDA recovered strongly, reaching a new high of $5.7 billion, surpassing prior years.

EV/EBITDA Ratio

This valuation multiple steadily increased from 10.24x in 2017 to a peak of 17.04x in 2020, before decreasing to 13.64x in 2021. The rising ratio through 2020 suggests that enterprise value grew at a faster pace relative to EBITDA, potentially indicating market optimism or valuation expansion despite EBITDA contraction. The subsequent decrease in 2021 reflects the EBITDA rebound outpacing the growth in enterprise value, leading to a more moderate valuation multiple.

Overall, the data suggests a growing enterprise value accompanied by fluctuating EBITDA performance, with a significant dip in 2020 but a rapid recovery the following year. The EV/EBITDA ratio's movements align with these EBITDA variations, indicating shifts in market valuation relative to earnings.