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Canadian National (CNI) Q3 Earnings & Revenues Lag Estimates
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Canadian National Railway Company’s (CNI - Free Report) third-quarter 2017 earnings per share (excluding 3 cents from non-recurring items) of $1.05 (C$1.31) fell short of the Zacks Consensus Estimate of $1.06. The bottom line however, climbed 9.4% from the year-ago figure.
Quarterly revenues of $2,576.8 million (C$3,221) also lagged the Zacks Consensus Estimate of $2,620.7 million but increased 11.5% year over year. Rail freight revenues, accounting for bulk of the top line in the quarter, improved 7%. The top line got a boost from increased volumes in segments namely, Overseas Intermodal, Frac sand, Coal and Petroleum coke exports, and Canadian grain.
Operating Results
On a year-over-year basis, freight revenues increased in segments like Metals and Minerals (31%), Coal (23%), Intermodal (12%) and Automotive (4%). However, the same declined in segments like Forest Products (2%) and Grain and Fertilizers (1%). Petroleum and Chemicals revenue remained flat year over year. Overall, carloads (volumes) expanded 11% and revenue ton miles (RTMs) rallied 10% year over year. Rail freight revenues per carload declined 4%in the reported quarter.
The Metals and minerals sub group performed most impressively with respect to car loads that surged 23%. The other segment to report double-digit volume growth is Intermodal, showing a 20% rise. Petroleum and Chemicals segment reported an increase of 3% year over year. However, Forest Products and Coal volumes decreased 2% and 7%, respectively. Grain and Fertilizers, and Automotive volumes contracted 3% each.
In the quarter under review, operating income grew 3.7% year over year to C$1,459. Operating ratio (defined as operating expenses as a percentage of revenues) was 54.7% compared with 53.3% in the year-ago quarter. Higher fuel costs contributed to this key metric’s deterioration.
Canadian National Railway Company Price, Consensus and EPS Surprise
This Zacks Rank #3 (Hold) company exited the third quarter with free cash flow of C$662 million compared with C$574 million a year ago. Adjusted debt at the end of the quarter was C$10,894 million compared with C$11,245 million a year ago. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Guidance
Canadian National continues to expect full-year 2017 earnings per share in the band of C$4.95-C$5.10 compared with C$4.59 a year ago.
Upcoming Releases
Investors interested in the broader Transportation sector are keenly awaiting third-quarter earnings reports from key players like American Airlines Group, Inc. (AAL - Free Report) , Southwest Airlines Company (LUV - Free Report) and Union Pacific Corporation (UNP - Free Report) . All are scheduled to report their respective earnings numbers on Oct 26.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors.
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Canadian National (CNI) Q3 Earnings & Revenues Lag Estimates
Canadian National Railway Company’s (CNI - Free Report) third-quarter 2017 earnings per share (excluding 3 cents from non-recurring items) of $1.05 (C$1.31) fell short of the Zacks Consensus Estimate of $1.06. The bottom line however, climbed 9.4% from the year-ago figure.
Quarterly revenues of $2,576.8 million (C$3,221) also lagged the Zacks Consensus Estimate of $2,620.7 million but increased 11.5% year over year. Rail freight revenues, accounting for bulk of the top line in the quarter, improved 7%. The top line got a boost from increased volumes in segments namely, Overseas Intermodal, Frac sand, Coal and Petroleum coke exports, and Canadian grain.
Operating Results
On a year-over-year basis, freight revenues increased in segments like Metals and Minerals (31%), Coal (23%), Intermodal (12%) and Automotive (4%). However, the same declined in segments like Forest Products (2%) and Grain and Fertilizers (1%). Petroleum and Chemicals revenue remained flat year over year. Overall, carloads (volumes) expanded 11% and revenue ton miles (RTMs) rallied 10% year over year. Rail freight revenues per carload declined 4%in the reported quarter.
The Metals and minerals sub group performed most impressively with respect to car loads that surged 23%. The other segment to report double-digit volume growth is Intermodal, showing a 20% rise. Petroleum and Chemicals segment reported an increase of 3% year over year. However, Forest Products and Coal volumes decreased 2% and 7%, respectively. Grain and Fertilizers, and Automotive volumes contracted 3% each.
In the quarter under review, operating income grew 3.7% year over year to C$1,459. Operating ratio (defined as operating expenses as a percentage of revenues) was 54.7% compared with 53.3% in the year-ago quarter. Higher fuel costs contributed to this key metric’s deterioration.
Canadian National Railway Company Price, Consensus and EPS Surprise
Canadian National Railway Company Price, Consensus and EPS Surprise | Canadian National Railway Company Quote
Liquidity
This Zacks Rank #3 (Hold) company exited the third quarter with free cash flow of C$662 million compared with C$574 million a year ago. Adjusted debt at the end of the quarter was C$10,894 million compared with C$11,245 million a year ago. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Guidance
Canadian National continues to expect full-year 2017 earnings per share in the band of C$4.95-C$5.10 compared with C$4.59 a year ago.
Upcoming Releases
Investors interested in the broader Transportation sector are keenly awaiting third-quarter earnings reports from key players like American Airlines Group, Inc. (AAL - Free Report) , Southwest Airlines Company (LUV - Free Report) and Union Pacific Corporation (UNP - Free Report) . All are scheduled to report their respective earnings numbers on Oct 26.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors.
Click here for Zacks' secret trade>>