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The Zacks Analyst Blog Highlights: Union Pacific, CSX, Kansas City Southern, Norfolk Southern and Canadian Pacific Railway
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For Immediate Release
Chicago, IL – April 22, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Union Pacific (UNP - Free Report) , CSX Corp. (CSX - Free Report) , Kansas City Southern , Norfolk Southern (NSC - Free Report) and Canadian Pacific Railway (CP - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
Rails Making a Comeback?
America’s largest railroad company, Union Pacific, beat earnings this morning sending the stock surging over 4%. UNP announced Q1 EPS at $1.93 per share beating the $1.89 estimates and was up 15% from EPS reported for the same quarter in 2018. UNP followed suit of railroad earnings with both CSX Corp. and Kansas City Southern reporting a strong positive earnings surprise earlier this week.
Union Pacific announced it would temporarily halt its $550 million project in Brazos, Texas as well as close down two “hump yards” in order to focus on operational efficiencies. The Brazos project is the largest undertaking in the history of Union Pacific, which dates back to 1862.
The entire railroad industry is hitting all-time highs this week following strong earnings support. The question that we pose to ourselves as investors is, what is driving this and what implications does this have on the broader markets?
Railroads have been the backbone of the US economy since the industrial revolution in the 1800s. We rely on railways to get our bulk cargo from one side of the US to the other with ease. When the economy is doing well so are railroad companies. Strong economic performance means businesses require more goods to be transported, causing railroad earnings to have a direct positive correlation with the markets.
The main driver of this seems to be the growing margins that each one of these companies is achieving. The railways are becoming more efficient, having more cars per load and fewer delays. Also, fuel costs have fallen since their high in September, allowing these railroads to operate each trip at a lower cost.
Upcoming Railroad Earnings
Norfolk Southern: 4/24
Norfolk Southern connects 22 states in Eastern US, operating 19,420 miles of rails. NSC is expected to have earnings of $2.17 per share, which would represent over 12% growth from the same quarter last year. Norfolk has an estimated to have Q1 revenue of $2.8 billion, over 3% growth from 2018.
NSC has beat estimates for 6 consecutive earnings reports prior to this one. NSC has delivered returns exceeding 33% to investors so far this year so a beat may already have been priced in with the railway earnings being so strong already this week. NSC – Zacks Rank #3 (Hold)
Canadian Pacific Railway: 4/23
Canadian Pacific Railways was created in the late 1800s and connects the northern US with southern Canada. CP is estimated to have earnings of $2.29 per share, which would be a 7.5% increase from the same quarter last year but a decline of over 33% from the previous quarter. They are expected to report $1.3 billion in quarterly revenue. CP has had mixed EPS surprises but has beat 5 out of the last 6 revenue estimates. CP – Zacks Rank #3 (Hold).
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-holds for the year?
Who wouldn't? Our annual Top 10s have beaten the market with amazing regularity. In 2018, while the market dropped -5.2%, the portfolio scored well into double-digits overall with individual stocks rising as high as +61.5%. And from 2012-2017, while the market boomed +126.3, Zacks' Top 10s reached an even more sensational +181.9%.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights: Union Pacific, CSX, Kansas City Southern, Norfolk Southern and Canadian Pacific Railway
For Immediate Release
Chicago, IL – April 22, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Union Pacific (UNP - Free Report) , CSX Corp. (CSX - Free Report) , Kansas City Southern , Norfolk Southern (NSC - Free Report) and Canadian Pacific Railway (CP - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
Rails Making a Comeback?
America’s largest railroad company, Union Pacific, beat earnings this morning sending the stock surging over 4%. UNP announced Q1 EPS at $1.93 per share beating the $1.89 estimates and was up 15% from EPS reported for the same quarter in 2018. UNP followed suit of railroad earnings with both CSX Corp. and Kansas City Southern reporting a strong positive earnings surprise earlier this week.
Union Pacific announced it would temporarily halt its $550 million project in Brazos, Texas as well as close down two “hump yards” in order to focus on operational efficiencies. The Brazos project is the largest undertaking in the history of Union Pacific, which dates back to 1862.
The entire railroad industry is hitting all-time highs this week following strong earnings support. The question that we pose to ourselves as investors is, what is driving this and what implications does this have on the broader markets?
Railroads have been the backbone of the US economy since the industrial revolution in the 1800s. We rely on railways to get our bulk cargo from one side of the US to the other with ease. When the economy is doing well so are railroad companies. Strong economic performance means businesses require more goods to be transported, causing railroad earnings to have a direct positive correlation with the markets.
The main driver of this seems to be the growing margins that each one of these companies is achieving. The railways are becoming more efficient, having more cars per load and fewer delays. Also, fuel costs have fallen since their high in September, allowing these railroads to operate each trip at a lower cost.
Upcoming Railroad Earnings
Norfolk Southern: 4/24
Norfolk Southern connects 22 states in Eastern US, operating 19,420 miles of rails. NSC is expected to have earnings of $2.17 per share, which would represent over 12% growth from the same quarter last year. Norfolk has an estimated to have Q1 revenue of $2.8 billion, over 3% growth from 2018.
NSC has beat estimates for 6 consecutive earnings reports prior to this one. NSC has delivered returns exceeding 33% to investors so far this year so a beat may already have been priced in with the railway earnings being so strong already this week. NSC – Zacks Rank #3 (Hold)
Canadian Pacific Railway: 4/23
Canadian Pacific Railways was created in the late 1800s and connects the northern US with southern Canada. CP is estimated to have earnings of $2.29 per share, which would be a 7.5% increase from the same quarter last year but a decline of over 33% from the previous quarter. They are expected to report $1.3 billion in quarterly revenue. CP has had mixed EPS surprises but has beat 5 out of the last 6 revenue estimates. CP – Zacks Rank #3 (Hold).
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-holds for the year?
Who wouldn't? Our annual Top 10s have beaten the market with amazing regularity. In 2018, while the market dropped -5.2%, the portfolio scored well into double-digits overall with individual stocks rising as high as +61.5%. And from 2012-2017, while the market boomed +126.3, Zacks' Top 10s reached an even more sensational +181.9%.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.