Canadian Pacific Kansas City (NYSE:CP) Releases Earnings Results, Beats Estimates By $0.03 EPS

Key Points

• Canadian Pacific Kansas City beat earnings estimates: The company reported quarterly EPS of $0.92, $0.03 above the $0.89 consensus estimate, with an 8.86% return on equity and a 27.20% net margin.
• Management highlighted strong growth prospects: Recent performance included 4% volume growth, 13% revenue growth and 13% adjusted EPS growth, while executives reaffirmed expectations for double-digit earnings growth in 2026 and cited expanding Mexico-related and cross-border traffic.
• Risks remain, but analysts are broadly bullish: Higher injury and train-accident rates, weak coal volumes and soft refined-fuel shipments into Mexico remain concerns. The stock received a “Moderate Buy” consensus rating, with an average price target of $104.91 versus roughly $91.35 at the time of reporting.

Canadian Pacific Kansas City (NYSE:CP - Get Free Report) TSE: CP announced its quarterly earnings data on Wednesday. The transportation company reported $0.92 earnings per share for the quarter, beating the consensus estimate of $0.89 by $0.03, Zacks reports. Canadian Pacific Kansas City had a return on equity of 8.86% and a net margin of 27.20%.

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

• Strong Q2 performance: CPKC reported 4% volume growth, 13% revenue growth, a 61.6% core adjusted operating ratio, and 13% adjusted EPS growth to $1.27. Management reaffirmed its expectation for another year of double-digit earnings growth in 2026.
• Broad-based growth pipeline: Grain, energy, chemicals, plastics, automotive, and metals all posted strong results, while Mexico-related services and cross-border “land bridge” traffic continued to expand. Management sees potential for land bridge revenue to grow from approximately $600 million this year toward $1 billion over time.
• Operating leverage and cash generation: Record productivity metrics, improved asset utilization, and network integration helped offset fuel, wage, casualty, and stock-compensation headwinds. Year-to-date adjusted pre-cash rose 25%, while the company remains on track for $2.65 billion of 2026 capital expenditures and returned $2.4 billion to shareholders in the first half.
• Safety and coal remain concerns: Personal injury frequency and train accidents increased year over year, and management acknowledged that customer mine-production problems will keep coal volumes a headwind in the second half. Refined-fuel shipments into Mexico also remain weak and dependent on improving market conditions.
• Capacity positioned for acceleration: Executives said the network has sufficient locomotives, railcars, and track capacity to support stronger demand, with incremental hiring as the primary near-term resource requirement. They expect sequential improvement in yields, volumes, operating leverage, and earnings in the second half.

Canadian Pacific Kansas City Trading Down 0.4%

NYSE:CP traded down $0.35 during midday trading on Wednesday, reaching $91.35. 3,063,675 shares of the stock traded hands, compared to its average volume of 2,791,736. The company has a fifty day moving average of $89.07 and a 200 day moving average of $83.74. Canadian Pacific Kansas City has a 12 month low of $68.42 and a 12 month high of $93.95. The stock has a market capitalization of $80.84 billion, a P/E ratio of 28.19, a PEG ratio of 1.82 and a beta of 1.10. The company has a debt-to-equity ratio of 0.46, a quick ratio of 0.57 and a current ratio of 0.67.

Wall Street Analyst Weigh In

CP has been the topic of several research reports. Citigroup boosted their price target on shares of Canadian Pacific Kansas City from $97.00 to $106.00 and gave the company a "buy" rating in a research report on Thursday, July 9th. Argus set a $105.00 price target on shares of Canadian Pacific Kansas City in a report on Tuesday, June 16th. Susquehanna upped their target price on Canadian Pacific Kansas City from $104.00 to $106.00 and gave the stock a "positive" rating in a research note on Tuesday, July 14th. Evercore set a $91.00 target price on shares of Canadian Pacific Kansas City and gave the company an "outperform" rating in a research report on Thursday, June 25th. Finally, Citizens Jmp started coverage on Canadian Pacific Kansas City in a research report on Wednesday, July 15th. They set a "market perform" rating on the stock. One research analyst has rated the stock with a Strong Buy rating, eleven have given a Buy rating and three have assigned a Hold rating to the stock. According to data from MarketBeat.com, the company has an average rating of "Moderate Buy" and a consensus target price of $104.91.

Hedge Funds Weigh In On Canadian Pacific Kansas City

Hedge funds and other institutional investors have recently made changes to their positions in the business. Janus Henderson Group PLC lifted its position in shares of Canadian Pacific Kansas City by 586.1% in the 4th quarter. Janus Henderson Group PLC now owns 6,147,835 shares of the transportation company's stock worth $452,781,000 after purchasing an additional 5,251,755 shares during the period. FIL Ltd increased its stake in shares of Canadian Pacific Kansas City by 20.2% in the 4th quarter. FIL Ltd now owns 16,666,777 shares of the transportation company's stock worth $1,227,045,000 after acquiring an additional 2,804,686 shares in the last quarter. BCV Asset Management Inc. purchased a new position in shares of Canadian Pacific Kansas City during the fourth quarter valued at approximately $82,391,000. Lazard Asset Management LLC grew its stake in shares of Canadian Pacific Kansas City by 281.2% in the third quarter. Lazard Asset Management LLC now owns 1,379,393 shares of the transportation company's stock worth $102,711,000 after acquiring an additional 1,017,576 shares during the last quarter. Finally, BNP Paribas Financial Markets raised its holdings in Canadian Pacific Kansas City by 818,578.8% in the third quarter. BNP Paribas Financial Markets now owns 925,107 shares of the transportation company's stock worth $68,911,000 after buying an additional 924,994 shares during the last quarter. Institutional investors own 72.20% of the company's stock.

About Canadian Pacific Kansas City

Canadian Pacific Kansas City (CPKC) is a North American Class I freight railroad formed through the combination of Canadian Pacific Railway and Kansas City Southern. The merged company operates an integrated rail network that spans Canada, the United States and Mexico, providing a single-line rail connection across all three countries. This transborder footprint is intended to streamline cross-border freight flows and provide shippers with direct rail access from Canadian and U.S. production centers to Mexican markets and ports.

CPKC's core business is freight transportation and related logistics services.

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