RBC Capital upgraded Norfolk Southern to Outperform from Sector Perform with an unchanged price target of $270. The company’s valuation does not reflect the step-function improvement in operating ration RBC expects the new operating team to enact, the analyst tells investors in a research note. The firm says Norfolk trades at a 9% discount to the group despite consensus 16% earnings growth expectations through 2027, a growth rate that is second best in the group. With the turnaround story intact, the recent share price volatility surrounding the proxy vote creates an attractive entry point, contends the firm.
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