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Canadian National (CNI) Q4 Earnings: What's in the Cards?
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Canadian National Railway Company (CNI - Free Report) is scheduled to report fourth-quarter 2017 results on Jan 23 after the market closes.
Last quarter, the company delivered a negative earnings surprise of 0.9%. Moreover, revenues fell short of expectations. However, both earnings and revenues increased substantially year over year.
Let’s see, how things are shaping up for this announcement.
Factors at Play
High fuel costs might hurt the company's performance in the to-be-reported quarter just as the previous one. Moreover, the metric is anticipated to affect its operating ratio in the period.
Also, declining revenues at the Forest Products plus Grain and Fertilizers segments might hamper the top line in the final quarter. Additonally, the company’s high debt levels are a concern.
Due to the above headwinds, shares of the company have underperformed its industry in the last three months. The stock has declined 2.2% against the industry’s gain of 10.8%.
However, volume growth at its key units like Overseas Intermodal, Frac sand, Coal and Petroleum coke exports plus Canadian grain should aid the company in the fourth quarter. Rail freight revenues, accounting for the bulk of the top line, should also rise significantly in the quarter.
What Does Our Model Say?
Our proven model does not conclusively show that the stock is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as explained below.
Zacks Rank: Canadian National carries a Zacks Rank #3, which incresaes the predictive power of ESP.
Zacks ESP: Canadian National has an Earnings ESP of -0.93% as the Most Accurate estimate is pegged at 96 cents per share, lower than the Zacks Consensus Estimate of 97 cents. However, we need to have a positive ESP to be confident about an earnings surprise. Hence, this combination leaves surprise prediction inconclusive. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
We caution against Sell-rated stocks (#4 or 5) going into an earnings announcement, especially when the company is witnessing negative estimate revisions.
Canadian National Railway Company Price and EPS Surprise
Investors interested in the Transportation sector may consider Kansas City Southern , Spirit Airlines, Inc. (SAVE - Free Report) and Union Pacific Corporation (UNP - Free Report) stocks for comprising the right combination of elements to beat estimates in their next releases this time around.
Kansas City Southern has an Earnings ESP of +0.21% and a Zacks Rank of 3. The company is scheduled to report fourth-quarter earnings on Jan 19.
Union Pacific has an Earnings ESP of +0.45% and a Zacks Rank #2. The company will release fourth-quarter earnings on Jan 25.
Zacks Top 10 Stocks for 2018
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2018?
Last year's 2017 Zacks Top 10 Stocks portfolio produced double-digit winners, including FMC Corp. and VMware which racked up stellar gains of +67.9% and +61%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
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Canadian National (CNI) Q4 Earnings: What's in the Cards?
Canadian National Railway Company (CNI - Free Report) is scheduled to report fourth-quarter 2017 results on Jan 23 after the market closes.
Last quarter, the company delivered a negative earnings surprise of 0.9%. Moreover, revenues fell short of expectations. However, both earnings and revenues increased substantially year over year.
Let’s see, how things are shaping up for this announcement.
Factors at Play
High fuel costs might hurt the company's performance in the to-be-reported quarter just as the previous one. Moreover, the metric is anticipated to affect its operating ratio in the period.
Also, declining revenues at the Forest Products plus Grain and Fertilizers segments might hamper the top line in the final quarter. Additonally, the company’s high debt levels are a concern.
Due to the above headwinds, shares of the company have underperformed its industry in the last three months. The stock has declined 2.2% against the industry’s gain of 10.8%.
However, volume growth at its key units like Overseas Intermodal, Frac sand, Coal and Petroleum coke exports plus Canadian grain should aid the company in the fourth quarter. Rail freight revenues, accounting for the bulk of the top line, should also rise significantly in the quarter.
What Does Our Model Say?
Our proven model does not conclusively show that the stock is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as explained below.
Zacks Rank: Canadian National carries a Zacks Rank #3, which incresaes the predictive power of ESP.
Zacks ESP: Canadian National has an Earnings ESP of -0.93% as the Most Accurate estimate is pegged at 96 cents per share, lower than the Zacks Consensus Estimate of 97 cents. However, we need to have a positive ESP to be confident about an earnings surprise. Hence, this combination leaves surprise prediction inconclusive. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
We caution against Sell-rated stocks (#4 or 5) going into an earnings announcement, especially when the company is witnessing negative estimate revisions.
Canadian National Railway Company Price and EPS Surprise
Canadian National Railway Company Price and EPS Surprise | Canadian National Railway Company Quote
Stocks to Consider
Investors interested in the Transportation sector may consider Kansas City Southern , Spirit Airlines, Inc. (SAVE - Free Report) and Union Pacific Corporation (UNP - Free Report) stocks for comprising the right combination of elements to beat estimates in their next releases this time around.
Kansas City Southern has an Earnings ESP of +0.21% and a Zacks Rank of 3. The company is scheduled to report fourth-quarter earnings on Jan 19.
Spirit Airlines has an Earnings ESP of +3.30% and is a #3 Ranked player. The company will report fourth-quarter earnings on Feb 6. You can see the complete list of today’s Zacks #1 Rank stocks here.
Union Pacific has an Earnings ESP of +0.45% and a Zacks Rank #2. The company will release fourth-quarter earnings on Jan 25.
Zacks Top 10 Stocks for 2018
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2018?
Last year's 2017 Zacks Top 10 Stocks portfolio produced double-digit winners, including FMC Corp. and VMware which racked up stellar gains of +67.9% and +61%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2018 today >>