Question 1

What is Norfolk Southern Corp.'s WACC?

Accepted Answer

Norfolk Southern Corp. (NSC) has a Weighted Average Cost of Capital (WACC) of 7.37%. This is calculated using a Cost of Equity of 8.15% (via CAPM with a beta of 0.77) and a pre-tax Cost of Debt of 4.79%, with an equity weight of 82.16% in the capital structure.

Question 2

Is Norfolk Southern Corp.'s WACC high or low?

Accepted Answer

Norfolk Southern Corp.'s WACC of 7.37% is below the typical range of 8-12% for most companies, indicating relatively low cost of capital and lower risk. WACC is used as the discount rate in DCF valuations — a lower WACC results in higher present values of future cash flows.

Question 3

How is Norfolk Southern Corp.'s WACC calculated?

Accepted Answer

Norfolk Southern Corp.'s WACC is calculated using the formula: WACC = (E/V × Re) + (D/V × Rd × (1-T)). The Cost of Equity (Re) of 8.15% is derived from the CAPM model using a beta of 0.77. The pre-tax Cost of Debt (Rd) is 4.79%. The capital structure is 82.16% equity and 17.84% debt.

Norfolk Southern Corp. (NSC) — WACC 分析

WACC 构成

解读

Norfolk Southern Corp.（NSC）WACC：7.37%

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Norfolk Southern Corp.（NSC） WACC 解读

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NSC DCF 估值

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