Wells Fargo downgrades Norfolk Southern to Equal Weight, lowers target to $245

As previously reported, Wells Fargo analyst Allison Poliniak-Cusic downgraded Norfolk Southern to Equal Weight from Overweight with a price target of $245, down from $285, citing too many headwinds. Her downgrade is based on the view that volumes are unlikely to outperform peers and could underperform given exposure to intermodal and coal; focus on consistent resourcing through cycles to improve competitive positioning in the upcycle could weigh on operating leverage near-term; and valuation relative to peers. With headwinds materializing in 2023, Poliniak-Cusic is lowering her 2023 EPS estimate to $14.00 from $14.45 and initiating her 2024 EPS estimate of $15.35.