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Canadian Pacific (CP) Down 1.2% Since Last Earnings Report: Can It Rebound?
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It has been about a month since the last earnings report for Canadian Pacific (CP - Free Report) . Shares have lost about 1.2% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Canadian Pacific due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Q4 Earnings Beat at Canadian Pacific
Canadian Pacific’s fourth-quarter 2022 earnings of 81 cents (C$1.14) per share beat the Zacks Consensus Estimate of 79 cents. The bottom line increased year over year.
Revenues of $1,813.6 million (C$2,462 million) lagged the Zacks Consensus Estimate of $1,834.6 million and increased year over year.
Freight revenues, contributing 98% to the top line, rose 21% on a year-over-year basis. CP’s freight segment consists of Grain (up 49%), Coal (down 11%), Potash (up 18%), Forest products (up 17%), Energy, chemicals and plastics (down 7%), Metals, minerals and consumer products (up 19%), Automotive (up 33%) and Intermodal (up 31%).
Revenues at the Fertilizers and sulfur sub-segment were up 11% year over year. In the reported quarter, total freight revenues per revenue ton-miles rose 12% year over year. Total freight revenues per carload increased 7% from the year-ago quarter’s reported figure.
On a reported basis, operating income was up 18.8%, while total operating expenses increased 21.9% year over year in the quarter under review.
Liquidity
Canadian Pacific exited the fourth quarter with cash and cash equivalents of C$451 million compared with C$138 million at the end of September 2022. Long-term debt amounted to C$18,141 million compared with C$19,339 million at the end of September 2022.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
VGM Scores
At this time, Canadian Pacific has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Canadian Pacific has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Canadian Pacific is part of the Zacks Transportation - Rail industry. Over the past month, Union Pacific (UNP - Free Report) , a stock from the same industry, has gained 0%. The company reported its results for the quarter ended December 2022 more than a month ago.
Union Pacific reported revenues of $6.18 billion in the last reported quarter, representing a year-over-year change of +7.8%. EPS of $2.67 for the same period compares with $2.66 a year ago.
Union Pacific is expected to post earnings of $2.62 per share for the current quarter, representing a year-over-year change of +2%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
Union Pacific has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.
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Canadian Pacific (CP) Down 1.2% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Canadian Pacific (CP - Free Report) . Shares have lost about 1.2% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Canadian Pacific due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Q4 Earnings Beat at Canadian Pacific
Canadian Pacific’s fourth-quarter 2022 earnings of 81 cents (C$1.14) per share beat the Zacks Consensus Estimate of 79 cents. The bottom line increased year over year.
Revenues of $1,813.6 million (C$2,462 million) lagged the Zacks Consensus Estimate of $1,834.6 million and increased year over year.
Freight revenues, contributing 98% to the top line, rose 21% on a year-over-year basis. CP’s freight segment consists of Grain (up 49%), Coal (down 11%), Potash (up 18%), Forest products (up 17%), Energy, chemicals and plastics (down 7%), Metals, minerals and consumer products (up 19%), Automotive (up 33%) and Intermodal (up 31%).
Revenues at the Fertilizers and sulfur sub-segment were up 11% year over year. In the reported quarter, total freight revenues per revenue ton-miles rose 12% year over year. Total freight revenues per carload increased 7% from the year-ago quarter’s reported figure.
On a reported basis, operating income was up 18.8%, while total operating expenses increased 21.9% year over year in the quarter under review.
Liquidity
Canadian Pacific exited the fourth quarter with cash and cash equivalents of C$451 million compared with C$138 million at the end of September 2022. Long-term debt amounted to C$18,141 million compared with C$19,339 million at the end of September 2022.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
VGM Scores
At this time, Canadian Pacific has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Canadian Pacific has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Canadian Pacific is part of the Zacks Transportation - Rail industry. Over the past month, Union Pacific (UNP - Free Report) , a stock from the same industry, has gained 0%. The company reported its results for the quarter ended December 2022 more than a month ago.
Union Pacific reported revenues of $6.18 billion in the last reported quarter, representing a year-over-year change of +7.8%. EPS of $2.67 for the same period compares with $2.66 a year ago.
Union Pacific is expected to post earnings of $2.62 per share for the current quarter, representing a year-over-year change of +2%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
Union Pacific has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.