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Here's Why Investors Should Give Canadian Pacific Stock a Miss Now
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Key Takeaways
CP's earnings estimate for 2025 and 2026 has been revised lower over the past 60 days.
The company's shares have fallen 4.7% in a year, trailing the Transportation - Rail industry.
Canadian Pacific is grappling with elevated expenses and a volatile macro and tariff environment.
Canadian Pacific Kansas City Limited (CP - Free Report) is facing mounting pressure from increased expenses. Tariff-related woes are also hurting the company’s prospects, making it an unattractive choice for investors’ portfolios.
CP: Key Risks to Watch
Southward Earnings Estimate Revision:The Zacks Consensus Estimate for 2025 earnings has been revised 2.33% downward in the past 60 days. Meanwhile, for 2026, the consensus mark for earnings has been revised 2.53% downward in the same time frame.
The unfavorable estimate revision indicates brokers’ lack of confidence in the stock.
Dim Price Performance: The company’s price trend reveals that its shares have fallen 4.7% over the past year compared with the Transportation - Rail industry’s 3.7% decline.
Image Source: Zacks Investment Research
Weak Zacks Rank: CP currently has a Zacks Rank #4 (Sell).
Bearish Industry Rank: The industry to which Canadian Pacific belongs currently has a Zacks Industry Rank of 207 (out of 243). Such an unfavorable rank places it in the bottom 14% of Zacks Industries. Studies show that 50% of a stock’s price movement is directly related to the performance of the industry group it belongs to.
A mediocre stock within a strong group is likely to outperform a robust stock in a weak industry. Hence, reckoning the industry’s performance becomes imperative.
Headwinds: CP is mired in significant challenges, dampening the company’s prospects. The increased expenses are weighing on the company’s bottom line. In the third quarter of 2025, the total operating expenses fell but remained at an elevated level of $2.33 billion.
Moreover, companies like CP are navigating a volatile macro environment marked by economic uncertainty, shifting tariff regulations and geopolitical tensions.
EXPD has an expected earnings growth rate of 2.3% for the current year. The company has an encouraging earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 13.94%.
SKYW currently carries a Zacks Rank #2 (Buy).
SkyWest has an expected earnings growth rate of 33% for the current year. The company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 21.2%.
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Here's Why Investors Should Give Canadian Pacific Stock a Miss Now
Key Takeaways
Canadian Pacific Kansas City Limited (CP - Free Report) is facing mounting pressure from increased expenses. Tariff-related woes are also hurting the company’s prospects, making it an unattractive choice for investors’ portfolios.
CP: Key Risks to Watch
Southward Earnings Estimate Revision:The Zacks Consensus Estimate for 2025 earnings has been revised 2.33% downward in the past 60 days. Meanwhile, for 2026, the consensus mark for earnings has been revised 2.53% downward in the same time frame.
The unfavorable estimate revision indicates brokers’ lack of confidence in the stock.
Dim Price Performance: The company’s price trend reveals that its shares have fallen 4.7% over the past year compared with the Transportation - Rail industry’s 3.7% decline.
Image Source: Zacks Investment Research
Weak Zacks Rank: CP currently has a Zacks Rank #4 (Sell).
Bearish Industry Rank: The industry to which Canadian Pacific belongs currently has a Zacks Industry Rank of 207 (out of 243). Such an unfavorable rank places it in the bottom 14% of Zacks Industries. Studies show that 50% of a stock’s price movement is directly related to the performance of the industry group it belongs to.
A mediocre stock within a strong group is likely to outperform a robust stock in a weak industry. Hence, reckoning the industry’s performance becomes imperative.
Headwinds: CP is mired in significant challenges, dampening the company’s prospects. The increased expenses are weighing on the company’s bottom line. In the third quarter of 2025, the total operating expenses fell but remained at an elevated level of $2.33 billion.
Moreover, companies like CP are navigating a volatile macro environment marked by economic uncertainty, shifting tariff regulations and geopolitical tensions.
Stocks to Consider
Investors interested in the Zacks Transportation sector may consider Expeditors International of Washington (EXPD - Free Report) and SkyWest (SKYW - Free Report) .
EXPD currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
EXPD has an expected earnings growth rate of 2.3% for the current year. The company has an encouraging earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 13.94%.
SKYW currently carries a Zacks Rank #2 (Buy).
SkyWest has an expected earnings growth rate of 33% for the current year. The company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 21.2%.