NYSE:BNI
$99.89
(2/9 1:07PM)
+0.2%
| Open | $99.69 |
Mkt Cap | $34.0 Billion |
| High | $99.91 |
52Wk High | $99.97 |
| Low | $99.63 |
52Wk Low | $50.86 |
| Volume | 2.6 Million |
Avg Vol 10D | 10.4 Million |
Ockham's Rating/Recommendation Summary
Rating specific information requires Premium Access.
Buy Now
or
Learn More about Ockham's Features and Services.
BNI Revenue
For a long time, value investors have used the current share price relative to sales per share levels as an important valuation tool. We utilize a historical weighted average methodology that treats recent years more importantly in the calculation. When looking at BNI through this framework, we can see that our weighted average historical high and low Price to Sales per share ratios over the last 10 years are 2.03x and 1.30x respectively.
Utilizing this range we can see that BNI’s current Price to Sales per share ratio of 2.42x is significantly above its historical average. This places BNI at the upper end of its historical range relative to sales per share and makes it difficult to suggest an attractive price outlook. At current sales per share levels, we would need to see a decline in the Price to Sales ratio of 45% merely to return BNI to its historical average.
BNI Cash Earnings
As the old saying goes, "Cash is King!" We look at reported Cash Earnings, but the main emphasis of our analysis involves stripping out non-cash events such as depreciation from our cash earnings analysis. This helps us view the cash flows more clearly. Nevertheless, an analysis of Cash Earnings (both reported and otherwise) is absolutely pivotal to assessing a company's value, and currently BNI is significantly above its historical average multiple of Cash Earnings. Looking at the last 10 years we can get a good understanding of what investors have grown to expect from BNI. For example, BNI's Cash Earnings ratio per share has fluctuated between 6.87 and 10.81 over this historical timeframe. This range is based upon a proprietary weighted methodology at Ockham, but can clearly show an investor where BNI is with respect to prior business periods.
Therefore, at the current price of $99.72 and a Price to Cash Earnings ratio of 10.31, BNI is significantly overvalued. This diminishes the attractiveness of BNI until we see either a significant increase in cash earnings or a decline in price. A decline of the Price to Cash Earnings ratio of 16% is needed just to return to the historical cash earnings multiple.
BNI Dividends
A strong dividend payment history is looked upon as a favorable characteristic on a company’s future and potentially can receive a positive Ockham rating. That being said, we don't require dividend payments for company's whose management has elected to forgo them entirely.
When reviewing dividend yields for BNI, we compare the historic high and low levels over the past, which is similar to our evaluation of Sales and Cash Earnings per share. Paying a dividend is not necessary for any company, but changes in dividend often can lend clues as to the health of the business. A rising dividend is a strong sign for an established company, as it reflects management's confidence in the company. BNI’s estimated annual dividend is $1.60 resulting in a current dividend yield of 1.60%. The highest dividend yield from BNI over recent history was 3.15% while the lowest dividend yield was 0.96%. It is never a good sign for a company to pay significantly lower dividends, in this case 22.14% below the median yield. Although, dividends are a relatively small portion of our analysis framework, we still see this as a negative factor.
Burlington Northern Santa Fe Corporation Talked About Near M&A Discussion on WSJ Marketbeat
While we do not know the details relating to BNI and any possible deal, our RazorWire news analytics has noticed a mention of the stock near a conversation about M&A activity.
When looking at our entire coverage universe and ranking stocks by the attention they receive on RazorWire, it is clear that Burlington Northern Santa Fe Corporation has been talked about more than normal recently. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on BNI. The Motley Fool CAPS data suggests that investors believe Burlington Northern Santa Fe Corporation will beat the market in the foreseeable future.
“… Berkshire went for a short-term mix of floating and fixed for to finance its BURLINGTON NORTHERN SANTA FE acquisition. Marketbeaters, which way would you go? …”
Zero Hedge: BNI is Among Most Active Stocks in the News Today
We are observing a lot of attention being paid to BNI in the news, so if you hold the stock you may want to take a look at what is going on.
The Motley Fool CAPS data suggests that investors believe Burlington Northern Santa Fe Corporation will beat the market in the foreseeable future. When looking at our entire coverage universe and ranking stocks by the attention they receive on RazorWire, it is clear that Burlington Northern Santa Fe Corporation has been talked about more than normal recently. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on BNI.
“… Berkshire to sell $8B of debt to finance the takeover of BURLINGTON NORTHERN SANTA FE Corp. Cigna swings to Q4 profit of $330M, topping estimates. Revs dip 3. 8% to $4. 64B. …”
Discussion Turns to BNI and Merger Talk on Seeking Alpha Wall St Breakfast
News broke today regarding mergers and acquisitions and Burlington Northern Santa Fe Corporation was discussed as well on Seeking Alpha Wall St Breakfast. Other sources will be required to know exactly what the context was in the discussion.
Burlington Northern Santa Fe Corporation receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals. Ranking all stocks in terms of news coverage offers some interesting data. In the case of BNI, it is getting significantly more attention in recent news coverage than we are used to seeing. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey.
“… A) sold $8B of senior unsecured notes on Thursday to help finance its purchase of BURLINGTON NORTHERN SANTA FE (BNI). The offering is more than double the size of Berkshire's ... …”
WSJ Marketbeat Discussed BNI in Relation to M&A Activity
RazorWire captured a discussion on WSJ Marketbeat that contained talk of M&A activity and BNI was mentioned as well.
Burlington Northern Santa Fe Corporation receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey. Ranking all stocks in terms of news coverage offers some interesting data. In the case of BNI, it is getting significantly more attention in recent news coverage than we are used to seeing.
“… Berkshire sold $8 billion for its acquisition of BURLINGTON NORTHERN SANTA FE. The deals were among the top 15 corporate investment grade offerings since 1995, according to ... …”
Burlington Northern Santa Fe Corporation Talked About Near M&A Discussion on Zero Hedge
RazorWire captured a discussion on Zero Hedge that contained talk of M&A activity and BNI was mentioned as well.
The Ockham valuation currently has a Fairly Valued stance on BNI because it trades within the price range that we would expect given current market conditions and fundamentals. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. In comparison to the other stocks that we follow, Burlington Northern Santa Fe Corporation has seen more discussion in relation to its normal ranking among the group. Be aware that the news sources we track are focusing on this stock more often these days.
“… on the corporate side is also surging courtesy of an $8 billion bond offering by a just-downgraded Berkshire in connection with its acquisition of BURLINGTON NORTHERN, as well as ... …”
Merger Talk with BNI on WSJ Marketbeat
While we do not know the details relating to BNI and any possible deal, our RazorWire news analytics has noticed a mention of the stock near a conversation about M&A activity.
Ranking all stocks in terms of news coverage offers some interesting data. In the case of BNI, it is getting significantly more attention in recent news coverage than we are used to seeing. Burlington Northern Santa Fe Corporation receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey.
“… Standard & Poor’s downgrading the debt of Warren Buffett’s Berkshire Hathaway and its core subsidiaries today, citing the strain that the planned BURLINGTON NORTHERN SANTA FE ... …”
Merger Talk with BNI on Zero Hedge
News broke today regarding mergers and acquisitions and Burlington Northern Santa Fe Corporation was discussed as well on Zero Hedge. Other sources will be required to know exactly what the context was in the discussion.
The Motley Fool CAPS data suggests that investors believe Burlington Northern Santa Fe Corporation will beat the market in the foreseeable future. When looking at our entire coverage universe and ranking stocks by the attention they receive on RazorWire, it is clear that Burlington Northern Santa Fe Corporation has been talked about more than normal recently. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on BNI.
“… OverviewBerkshire Hathaway plans to purchase BURLINGTON NORTHERN SANTA FE for approximately $26 billion in cash and stock for the shares it does not already own. …”
Merger Talk with BNI on Zero Hedge
RazorWire captured a discussion on Zero Hedge that contained talk of M&A activity and BNI was mentioned as well.
Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. In comparison to the other stocks that we follow, Burlington Northern Santa Fe Corporation has seen more discussion in relation to its normal ranking among the group. Be aware that the news sources we track are focusing on this stock more often these days. Burlington Northern Santa Fe Corporation receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals.
“… RationaleWe are taking these actions in anticipation of BRK's acquisition of BURLINGTON NORTHERN SANTA FE Corp. (BNSF), which we expect to close no later than Feb. 15. …”
Zero Hedge Discussed BNI in Relation to M&A Activity
RazorWire captured a discussion on Zero Hedge that contained talk of M&A activity and BNI was mentioned as well.
The Motley Fool CAPS data suggests that investors believe Burlington Northern Santa Fe Corporation will beat the market in the foreseeable future. When looking at our entire coverage universe and ranking stocks by the attention they receive on RazorWire, it is clear that Burlington Northern Santa Fe Corporation has been talked about more than normal recently. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on BNI.
“… Earnings remain very strong, and we expect them to increase following the acquisition of BNSF. It is our expectation that Berkshire likely will use these incremental earnings and ... …”
Debt a Topic of Conversation for Burlington Northern Santa Fe Corporation on Zero Hedge
In the aftermath of the credit crisis, debt is a key area investors should understand. A recent news story on Zero Hedge talks about BNI's debt load.
The Motley Fool CAPS data suggests that investors believe Burlington Northern Santa Fe Corporation will beat the market in the foreseeable future. When looking at our entire coverage universe and ranking stocks by the attention they receive on RazorWire, it is clear that Burlington Northern Santa Fe Corporation has been talked about more than normal recently. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on BNI.
“… Following the acquisition, BNSF will represent the second-largest noninsurance segment within Berkshire, after MidAmerican. …”