Morgan Stanley analyst Ravi Shanker resumed coverage of Norfolk Southern with an Underweight rating and $175 price target. The analyst believes the company faces revenue challenges rather than cost hurdles. Norfolk’s revenue challenges are inherently more structural and take longer to fix than cost cutting, the analyst tells investors in a research note. The firm believes the stock’s risk/reward, while improving, still skews negatively. It says Norfolk still has a wide operating ratio gap to peers with no immediate path to close it.
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