Canadian Pacific Kansas City (CP, Financial) has officially designated its initial batch of nine Site Ready locations, strategically situated throughout North America. These sites are rail-served, offering prime potential for industrial development.
This initiative aligns with CPKC's "Room to Grow" strategy, aiming to streamline and enhance industrial growth opportunities by leveraging rail connectivity. Each certified site is uniquely positioned to meet the demands of expanding industries, ensuring swift and efficient logistics solutions for future tenants.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 22 analysts, the average target price for Canadian Pacific Kansas City Ltd (CP, Financial) is $87.86 with a high estimate of $114.42 and a low estimate of $72.41. The average target implies an upside of 20.24% from the current price of $73.07. More detailed estimate data can be found on the Canadian Pacific Kansas City Ltd (CP) Forecast page.
Based on the consensus recommendation from 26 brokerage firms, Canadian Pacific Kansas City Ltd's (CP, Financial) average brokerage recommendation is currently 2.1, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Canadian Pacific Kansas City Ltd (CP, Financial) in one year is $104.29, suggesting a upside of 42.73% from the current price of $73.07. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Canadian Pacific Kansas City Ltd (CP) Summary page.
CP Key Business Developments
Release Date: January 29, 2025
- Quarterly Revenue: $3.9 billion, up 3%.
- Quarterly Volume Growth: 2% increase.
- Quarterly Operating Ratio: 57.1%, a 160 basis point improvement.
- Quarterly Core EPS: $1.29, up 9% year-over-year.
- Full Year Revenue: $14.5 billion, up 5%.
- Full Year Volume Growth: 3% increase.
- Full Year Operating Ratio: 61.3%, a 70 basis point improvement.
- Full Year Core EPS: $4.25, up 11% year-over-year.
- Grain Revenue Growth: 11% increase, record Q4 performance.
- Automotive Revenue Growth: 16% increase, with a 23% volume growth.
- Intermodal Revenue Decline: 6% decrease, with 1% volume growth.
- Fuel Expense: $459 million, down 13% year-over-year.
- Cash Flow from Operations: $5.3 billion in 2024.
- Capital Expenditures: $2.8 billion in 2024, with a 2025 outlook of $2.9 billion.
- Free Cash Flow: $2.7 billion adjusted combined for the year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Canadian Pacific Kansas City Ltd (CP, Financial) reported a 3% increase in quarterly revenues to $3.9 billion and a 5% increase in full-year revenues to $14.5 billion.
- The company achieved a 160 basis point improvement in its operating ratio for the quarter, reaching 57.1%, and a 70 basis point improvement for the full year.
- CPKC was named GM Supplier of the Year for finished vehicles in 2024, highlighting its strong performance in the automotive sector.
- The company completed the construction of the second span of the Laredo Bridge, enhancing capacity and efficiency at the U.S.-Mexico border.
- CPKC achieved a 26% year-over-year improvement in personal injury frequency and led the industry with the lowest train accident frequency among Class 1 railroads.
Negative Points
- The company faced challenges such as work stoppages at the Port of Vancouver and adverse winter weather conditions, impacting operations.
- Potash revenues declined by 4% due to a 7% volume decline, affected by strikes and weather conditions.
- Coal revenue decreased by 3% with an 8% decline in volume, driven by a customer outage and weather impacts.
- International Intermodal volumes were down 1%, primarily due to labor disruptions at the Port of Vancouver.
- The company anticipates uncertainties in macroeconomic conditions and trade policies, which could impact future growth.
