Norfolk Southern Corp. CEO Alan Shaw was in Washington this week, providing testimony on the East Palestine, Ohio, train derailment before the Senate Committee on Environment and Public Works. During the hearing, Senate Democrats Jeff Merkley of Oregon and Debbie Stabenow of Michigan pushed Shaw on Norfolk Southern’s stock buybacks.
Vermont Sen. Bernie Sanders, meanwhile, went after the CEO about the company’s
use of precision scheduled railroading, which focuses on the movement of individual train cars, rather than whole trains. A key industry trend of recent years, PSR aims to boost railroad efficiency by streamlining operations. Citi analyst Christian Wetherbee says that Shaw handled Thursday’s grilling “arguably a bit better than expected” and stuck to a consistent message of safety and responsibility. “Predictable attacks on buybacks and PSR from various senators did not appear damaging, but underscore the bipartisan nature of current rail scrutiny,” Wetherbee added. “Following a tumultuous several months leading back to the union contract resolution, we think it’s possible Thursday represented ‘peak headline negatively’ for the group, underscored by a reported NS derailment as Mr. Shaw testified.” Related: Norfolk Southern will do ‘everything it takes’ for East Palestine, CEO tells senators Also see: Norfolk Southern committed to ‘making this right’ for East Palestine after Ohio derailment, CEO to tell senators “We think the longer-term value opportunity presented by the U.S. rails, including NS, is building,” wrote Wetherbee. Norfolk Southern’s stock, which has fallen 16.2% since the Feb. 3 derailment near the Ohio-Pennsylvania border, fell 0.9% Friday. Shares of fellow Class I rail carriers CSX Corp.
and Union Pacific Corp.
fell 0.6% and 1.6%, respectively, on Friday. The S&P 500 Index
was down 1.4%. A Class I carr …