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Canadian Pacific Kansas City Ltd CP

Morningstar Rating
$85.25 −0.82 (0.95%)
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Company Report

Canadian Pacific's Intermodal Activity Stabilizing; 2024 Growth Outlook Favorable

Following the appointment of railroading legend Hunter Harrison as CEO in 2012, Canadian Pacific embarked on a successful profitability turnaround. Initially upon taking the helm, Harrison closed numerous intermodal terminals and hump yards to rightsize the network. He also sold nonessential rail lines, turned over leadership, and rightsized the workforce and overall asset base.

Price vs Fair Value

CP is trading at a 16% premium.
Price
$86.06
Fair Value
$37.00
Uncertainty
Medium
1-Star Price
$98.60
5-Star Price
$94.90
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

The Kansas City Southern merger, which creates new, seamless intermodal lanes, should yield meaningful opportunities for incremental volume growth.

Bears

Canadian grain carload-volume growth will likely take a breather in 2024 on a less robust late-2023 harvest and a less favorable export backdrop (to China).

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News

Trading Information

Previous Close Price
$86.07
Day Range
$85.2385.88
52-Week Range
$68.9886.91
Bid/Ask
$85.25 / $85.26
Market Cap
$79.47 Bil
Volume/Avg
567,884 / 2.4 Mil

Key Statistics

Price/Earnings (Normalized)
30.35
Price/Sales
8.64
Dividend Yield (Trailing)
0.65%
Dividend Yield (Forward)
0.49%
Total Yield
0.65%

Company Profile

Canadian Pacific Kansas City is a Class-1 railroad operating on track that spans across most of Canada and into parts of the Midwestern and Northeastern United States. Following the April 2023 Kansas City Southern merger, CP operates new single-line-haul services from Canada and the Upper Midwest down through Texas, the Gulf of Mexico, and into Mexico. It also hauls cross border and intra Mexico freight via operating concessions on roughly 3,300 miles of rail in Mexico. CP hauls shipments of grain, intermodal containers, energy products (like crude and frac sand), chemicals, plastics, coal, fertilizer and potash, automotive products, and a diverse mix of other merchandise.
Sector
Industrials
Industry
Railroads
Stock Style Box
Large Growth
Total Number of Employees
20,310

Competitors

Valuation

Metric
CP
CSX
UNP
Price/Earnings (Normalized)
30.3520.7824.29
Price/Book Value
2.566.1310.44
Price/Sales
8.645.216.41
Price/Cash Flow
24.4114.0817.80
Price/Earnings
CP
CSX
UNP

Financial Strength

Metric
CP
CSX
UNP
Quick Ratio
0.410.880.62
Current Ratio
0.531.050.81
Interest Coverage
−2.966.957.11
Quick Ratio
CP
CSX
UNP

Profitability

Metric
CP
CSX
UNP
Return on Assets (Normalized)
11.88%8.83%9.63%
Return on Equity (Normalized)
22.85%30.10%47.89%
Return on Invested Capital (Normalized)
15.61%13.72%15.34%
Return on Assets
CP
CSX
UNP
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Economic Moat
Market Cap
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NSC
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CJPRY
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EJPRF
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