Buy or Sell Norfolk Southern Stock Ahead of Its Upcoming Earnings?

Norfolk Southern (NYSE:NSC) is scheduled to announce its earnings on Tuesday, July 29, 2025. Over the last five years, Norfolk Southern’s stock has shown an equal split in one-day returns following earnings announcements. In 50% of instances, the stock experienced a positive one-day return, with a median gain of 2.3%. Conversely, in the other 50% of instances, it saw a negative one-day return, with a median decline of -1.8%.

While the actual results compared to consensus estimates will be crucial, understanding these historical patterns can provide an edge for event-driven traders. There are two primary approaches to leverage this information:

• Pre-Earnings Positioning: Traders might consider taking a position before the earnings release, based on historical probabilities.
• Post-Earnings Analysis: Alternatively, traders can analyze the correlation between immediate and medium-term returns after the earnings are released to inform their positioning.

Analysts’ consensus estimates for the upcoming quarter are earnings of $3.30 per share on revenue of $3.13 billion. This compares to year-ago quarter earnings of $3.06 per share on revenue of $3.04 billion, indicating an expected increase in both profitability and revenue.

From a fundamental perspective, Norfolk Southern has a current market capitalization of $63 billion. Over the last twelve months, the company generated $12 billion in revenue, and was operationally profitable with $4.9 billion in operating profits and a net income of $3.3 billion.

That said, if you seek upside with lower volatility than individual stocks, the Trefis High Quality portfolio presents an alternative — having outperformed the S&P 500 and generated returns exceeding 91% since its inception.

See earnings reaction history of all stocks

Pixabay

Norfolk Southern’s Historical Odds Of Positive Post-Earnings Return

Some observations on one-day (1D) post-earnings returns:

• There are 20 earnings data points recorded over the last five years, with 10 positive and 10 negative one-day (1D) returns observed. In summary, positive 1D returns were seen about 50% of the time.
• The percentage remains the same at 50% if we consider data for the last 3 years instead of 5.
• Median of the 10 positive returns = 2.3%, and median of the 10 negative returns = -1.8%

Additional data for observed 5-Day (5D), and 21-Day (21D) returns post earnings are summarized along with the statistics in the table below.

NSC 1D, 5D, and 21D Post Earnings Return

Correlation Between 1D, 5D, and 21D Historical Returns

A relatively less risky strategy (though not useful if the correlation is low) is to understand the correlation between short-term and medium-term returns post earnings, find a pair that has the highest correlation, and execute the appropriate trade. For example, if 1D and 5D show the highest correlation, a trader can position themselves “long” for the next 5 days if 1D post-earnings return is positive. Here is some correlation data based on 5-year and 3-year (more recent) history. Note that the correlation 1D_5D refers to the correlation between 1D post-earnings returns and subsequent 5D returns.

NSC Correlation Between 1D, 5D and 21D Historical Returns

Learn more about Trefis RV strategy that has outperformed its all-cap stocks benchmark (combination of all 3, the S&P 500, S&P mid-cap, and Russell 2000), to produce strong returns for investors. Separately, if you want upside with a smoother ride than an individual stock like Norfolk Southern, consider the High Quality portfolio, which has outperformed the S&P, and clocked >91% returns since inception.

Invest with Trefis Market-Beating Portfolios

See all Trefis Price Estimates