Canadian Pacific Kansas City (NYSE:CP) Releases Quarterly Earnings Results, Misses Expectations By $0.03 EPS

Canadian Pacific Kansas City (NYSE:CP) (TSE:CP) announced its quarterly earnings results on Wednesday. The transportation company reported $0.91 EPS for the quarter, missing analysts’ consensus estimates of $0.94 by ($0.03), reports. Canadian Pacific Kansas City had a net margin of 25.02% and a return on equity of 9.02%. The firm had revenue of $2.96 billion for the quarter, compared to analyst estimates of $2.96 billion. During the same period in the previous year, the business posted $1.10 earnings per share. The business’s revenue for the quarter was up 15.2% compared to the same quarter last year.

Here are the key takeaways from Canadian Pacific Kansas City’s conference call:

• CPKC reported 6% volume growth, CAD 4.2 billion in revenue, a 61.9% core adjusted operating ratio, and 16% growth in adjusted EPS. Management said the company remains on track for mid-single-digit volume growth and a strong finish to the year.
• Operating performance improved across key metrics, including an 8% increase in train speed, 7% lower dwell, 10% higher car miles per car day, and 3% better fuel efficiency. CPKC also expects a sub-60% operating ratio in the fourth quarter.
• Commercial momentum remained broad-based, with record grain and intermodal performance, continued growth in the Canada-Mexico land bridge, and a new five-year Elk Valley Resources agreement that will return roughly half of certain coal traffic to CPKC’s network. Management highlighted additional opportunities in domestic intermodal, Mexico, Saint John, and port-related traffic.
• Higher fuel prices were a significant headwind, driving a 56% increase in fuel expense and adding 190 basis points to the quarterly adjusted operating ratio. Executives also acknowledged that elevated fuel surcharges are creating price sensitivity and may push some customers toward alternative transportation modes.
• Personal injury frequency rose 20% year over year to 1.12, despite a 60% improvement in train accidents. Management said the increase in employee injuries did not meet its safety standards and that corrective efforts would remain a priority.

Canadian Pacific Kansas City Trading Down 1.6%

Shares of Canadian Pacific Kansas City stock opened at $89.65 on Thursday. The company has a debt-to-equity ratio of 0.47, a quick ratio of 0.50 and a current ratio of 0.59. Canadian Pacific Kansas City has a 52 week low of $68.42 and a 52 week high of $96.90. The stock has a 50 day moving average price of $88.98 and a two-hundred day moving average price of $85.73. The stock has a market capitalization of $78.45 billion, a PE ratio of 28.83, a price-to-earnings-growth ratio of 1.88 and a beta of 1.13.

Canadian Pacific Kansas City News Roundup

Here are the key news stories impacting Canadian Pacific Kansas City this week:

• Positive Sentiment: CPKC reported third-quarter revenue of approximately $4.2 billion, while core adjusted diluted EPS rose to $1.28 from $1.10 a year earlier and exceeded the widely cited $0.95 consensus estimate by $0.33. Management said the company remains on track for a strong 2026 despite macroeconomic headwinds. CPKC reports solid third quarter results
• Positive Sentiment: CPKC signed a new five-year agreement with Elk Valley Resources, expanding its share of steelmaking-coal shipments from four British Columbia mines to Vancouver-area terminals. The deal provides longer-term freight volume visibility. CPKC and EVR renew and expand rail service agreement
• Positive Sentiment: The board declared a quarterly dividend of $0.268 per share, payable January 25, 2027, supporting the stock’s income appeal. CPKC declares dividend
• Neutral Sentiment: BlackRock disclosed a 5.02% ownership stake in Canadian Pacific Kansas City, indicating significant institutional participation but not necessarily a change in the company’s fundamentals. BlackRock ownership disclosure
• Negative Sentiment: Reported earnings were difficult to interpret: CPKC cited diluted EPS of $1.04 and adjusted EPS of $1.28, while a Zacks measure showed $0.91 per share versus a $0.94 estimate. The conflicting figures may have reduced the market’s enthusiasm. CPKC earnings estimate comparison
• Negative Sentiment: Zacks Research downgraded CP from “strong-buy” to “hold,” adding analyst-related pressure despite the company’s year-over-year revenue growth and adjusted earnings beat.

Wall Street Analyst Weigh In

A number of equities analysts have recently commented on CP shares. Stephens upgraded shares of Canadian Pacific Kansas City to a “hold” rating in a report on Wednesday, July 8th. Royal Bank Of Canada restated an “outperform” rating on shares of Canadian Pacific Kansas City in a report on Thursday, September 24th. Citizens Jmp assumed coverage on Canadian Pacific Kansas City in a research report on Wednesday, July 15th. They set a “market perform” rating for the company. Citigroup reaffirmed a “cautious” rating on shares of Canadian Pacific Kansas City in a report on Wednesday, October 7th. Finally, Zacks Research downgraded Canadian Pacific Kansas City from a “strong-buy” rating to a “hold” rating in a report on Monday. One analyst has rated the stock with a Strong Buy rating, twelve have assigned a Buy rating and four have issued a Hold rating to the company. According to data from MarketBeat, Canadian Pacific Kansas City currently has a consensus rating of “Moderate Buy” and an average target price of $111.83.

About Canadian Pacific Kansas City

Canadian Pacific Kansas City Limited (NYSE: CP) is a North American transportation company that operates Canadian Pacific Kansas City (CPKC), a Class I freight railway. The company was created in 2023 through the combination of Canadian Pacific and Kansas City Southern, forming the first single-line railroad connecting Canada, the United States and Mexico.

CPKC transports a broad range of freight, including grain and fertilizers, coal, forest products, automotive goods, energy and chemicals, industrial and consumer products, and intermodal shipments.