Kansas City Southern (NYSE:KSU) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a note issued to investors on Wednesday.

According to Zacks, “Kansas City Southern's shares comfortably outperformed the industry it belongs to in the last six months. The improving scenario with respect to coal is aiding Kansas City Southern significantly. We are also bullish on the company's efforts to reward shareholders dividend payments and buybacks. In line with this objective, the company recently hiked its quarterly dividend in excess of 9%. Moreover, its board cleared a new share repurchase program worth $800 million. Sluggish intermodal revenues and high fuel costs, however, remain concerns. Moreover, high fuel costs might limit bottom line growth going forward.”

KSU has been the subject of a number of other research reports. BidaskClub lowered shares of Kansas City Southern from a “strong-buy” rating to a “buy” rating in a report on Thursday, June 22nd. Credit Suisse Group raised Kansas City Southern from a “neutral” rating to an “outperform” rating and upped their price objective for the stock from $90.00 to $116.00 in a report on Friday, June 16th. Cowen and Company reiterated a “hold” rating on shares of Kansas City Southern in a research report on Friday, August 25th. Stifel Nicolaus reissued a “buy” rating and issued a $108.00 target price on shares of Kansas City Southern in a research note on Friday, June 30th. Finally, BMO Capital Markets reissued a “market perform” rating and issued a $105.00 target price (up from $98.00) on shares of Kansas City Southern in a research note on Tuesday, July 25th. Eleven research analysts have rated the stock with a hold rating, eight have assigned a buy rating and one has assigned a strong buy rating to the company. Kansas City Southern presently has an average rating of “Buy” and an average price target of $107.60.

Kansas City Southern (KSU) traded up 0.33% during trading on Wednesday, reaching $107.15. 266,815 shares of the company’s stock traded hands. The firm’s 50 day moving average is $105.96 and its 200-day moving average is $98.32. Kansas City Southern has a 12 month low of $79.05 and a 12 month high of $109.13. The company has a market capitalization of $11.30 billion, a price-to-earnings ratio of 21.56 and a beta of 0.81.

Kansas City Southern (NYSE:KSU) last announced its earnings results on Friday, July 21st. The transportation company reported $1.33 earnings per share for the quarter, topping the Zacks’ consensus estimate of $1.26 by $0.07. Kansas City Southern had a net margin of 21.52% and a return on equity of 11.40%. The company had revenue of $656.40 million during the quarter, compared to the consensus estimate of $627.81 million. During the same period in the previous year, the firm posted $1.22 earnings per share. The company’s revenue was up 15.5% on a year-over-year basis. Analysts expect that Kansas City Southern will post $5.20 EPS for the current fiscal year.

Kansas City Southern announced that its board has approved a share buyback program on Tuesday, August 15th that allows the company to buyback $800.00 million in outstanding shares. This buyback authorization allows the transportation company to reacquire up to 7.1% of its shares through open market purchases. Shares buyback programs are usually an indication that the company’s board of directors believes its stock is undervalued.

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In related news, SVP Mary K. Stadler sold 4,451 shares of the business’s stock in a transaction that occurred on Friday, August 18th. The stock was sold at an average price of $105.87, for a total value of $471,227.37. Following the completion of the transaction, the senior vice president now directly owns 8,814 shares in the company, valued at approximately $933,138.18. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, insider Delano Jose Guillermo Zozaya sold 6,000 shares of the business’s stock in a transaction that occurred on Monday, August 28th. The shares were sold at an average price of $102.93, for a total value of $617,580.00. Following the completion of the transaction, the insider now owns 42,087 shares of the company’s stock, valued at $4,332,014.91. The disclosure for this sale can be found here. In the last ninety days, insiders have sold 14,469 shares of company stock worth $1,522,510. 0.95% of the stock is currently owned by insiders.

Hedge funds and other institutional investors have recently bought and sold shares of the stock. Perpetual Ltd acquired a new stake in Kansas City Southern during the 2nd quarter worth approximately $7,674,000. Lord Abbett & CO. LLC lifted its stake in Kansas City Southern by 3.5% in the second quarter. Lord Abbett & CO. LLC now owns 679,426 shares of the transportation company’s stock valued at $71,102,000 after buying an additional 23,100 shares in the last quarter. Sentry Investment Management LLC lifted its stake in Kansas City Southern by 0.9% in the second quarter. Sentry Investment Management LLC now owns 7,524 shares of the transportation company’s stock valued at $787,000 after buying an additional 68 shares in the last quarter. Cetera Investment Advisers bought a new position in Kansas City Southern in the second quarter valued at approximately $233,000. Finally, Dynamic Technology Lab Private Ltd bought a new position in Kansas City Southern in the second quarter valued at approximately $642,000. 84.59% of the stock is owned by institutional investors and hedge funds.

Kansas City Southern Company Profile

Kansas City Southern (KCS) is a holding company. The Company has domestic and international rail operations in North America that are focused on the north/south freight corridor connecting commercial and industrial markets in the central United States with industrial cities in Mexico. The Company’s subsidiaries include The Kansas City Southern Railway Company (KCSR) and Kansas City Southern de Mexico, SA de C.V.

Analyst Recommendations for Kansas City Southern (NYSE:KSU)

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