Norfolk Southern Corp Financial Statistics ($ millions) ) Operating Revenues $10,863 Operating Expenses $7,730 Operating Income $3,133 Operating Ratio (%) 71.2% EBITDA $4,140 Net Income $1,706 Return on Sales (ROS) 15.7% Return on Equity (ROE) 14.1% Cash $433 Assets $33,527 Debt $9,496 Equity (book value) $12,129 Debt-to-Total Cap (book) 43.9% Equity (market value) $23,027 Stock Price ($) $76.40 Shares Outstanding (basic) 301.4 The above table shows information of Norfolk Southern Corporation (NS). Calculate an estimated value for value of Norfolk Southern using the market multiples approach. Use the average EBITDA multiple of the two most recent railroad acquisitions (year 2008 and year 2010). (HINT: The estimated share/stock price of NS= {(EBITDA multiple X EBITDA)-debt} /Shares Outstanding) Major Railroad Acquisitions and Transaction Multiples, 1995-2014 Acquirer Target Year EBITDA Multiple (Total Enterprise Value / EBITDA) Burlington Northern Santa Fe Pacific 1995 9x Union Pacific Chicago Northwestern 1995 8x Union Pacific Southern Pacific 1996 14x Norfolk Southern & CSX Conrail 1997 14x Canadian National Illinois Central 1998 10x Canadian National Wisconsin Central 2001 10x Canadian National BC Rail 2004 9x Canadian Pacific DM&E 2008 13x Berkshire Hathaway BNSF 2010 9x $106 $92 $120 O $115 O $76