Dahlman Rose Downgrades Norfolk Southern (NSC) to Hold; Eastern Rails Sidelined

September 4, 2012 9:05 AM EDT
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Price: $114.09 +3.75%

Rating Summary:
    12 Buy, 19 Hold, 6 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 22 | Down: 34 | New: 34
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Dahlman Rose downgraded Norfolk Southern (NYSE: NSC) from Buy to Hold.

Analyst, Jason H. Seidl, said, "Owing to the sharp declines in export metallurgical coal prices, we believe the Eastern Class I railroads could see volume declines in the next three quarters, as some producers could begin to cut production. Pricing pressure in the commodity could ensue in 2013 as contractual rate obligations come up for renewal. This, coupled with continued utility coal weakness and a slightly diminished overall rail pricing outlook, has caused us to become more cautious in our near- to medium-term outlook. As such, we are downgrading NSC to Hold."

FY12 EPS estimate lowered from $6.03 to $5.90 and FY13 from $6.70 to $6.10.

For an analyst ratings summary and ratings history on Norfolk Southern click here. For more ratings news on Norfolk Southern click here.

Shares of Norfolk Southern closed at $72.46 yesterday.

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