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CP Shares Decline 2.6% Since Second-Quarter 2026 Earnings Release
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Key Takeaways
Canadian Pacific's Q2 earnings rose 13%, while revenues increased 13% year over year.
Freight pricing and business mix lifted revenue per ton-mile 9% and per carload 12%.
Volumes rose 4%, train speed improved 7% and terminal dwell declined 16%.
Canadian Pacific Kansas City Limited (CP - Free Report) reported better-than-expected second-quarter 2026 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
However, the company’s stock has declined 2.6% since its earnings release on July 29, 2026.
Quarterly earnings of 92 cents per share beat the Zacks Consensus Estimate of 89 cents by 3.4%. The bottom line increased 13% year over year on a core adjusted basis.
Operating revenues of $3.01 billion surpassed the consensus estimate of $2.91 billion by 3.3%. In Canadian dollars, revenues increased 13% year over year to C$4.16 billion.
Canadian Pacific Kansas City Limited Price, Consensus and EPS Surprise
In the reported quarter, total freight revenues per revenue ton-mile increased 9% year over year. Total freight revenues per carload rose 12%, reflecting favorable pricing and business mix.
On a reported basis, operating income increased 10% year over year to C$1.47 billion. However, total operating expenses rose 14% to C$2.69 billion, mainly due to a 53% increase in fuel expenses. The reported operating ratio deteriorated 90 basis points to 64.6%, while the core adjusted operating ratio worsened by the same magnitude to 61.6%.
Volumes, measured in revenue ton-miles, increased 4% year over year to 57.58 billion. Average train speed improved 7%, while average terminal dwell declined 16%, indicating stronger network efficiency.
CP’s Segmental Highlights
Freight revenues, which accounted for 98% of the top line, increased 13% year over year to C$4.09 billion.
CP’s freight business comprises Grain (up 24%), Coal (down 18%), Potash (up 10%), Fertilizers and Sulphur (up 12%), Forest Products (up 2%), Energy, Chemicals and Plastics (up 9%), Metals, Minerals and Consumer Products (up 18%), Automotive (up 22%) and Intermodal (up 11%).
Grain benefited from a record Canadian harvest and strong U.S. export demand. Automotive revenues gained from new business wins, while domestic intermodal benefited from the company’s SMX service and improving truck-to-rail conversion opportunities. Coal remained the primary weak spot due to lower mine production and shipment volumes.
Non-freight revenues increased 8.6% year over year to C$76 million in the second quarter.
CP’s Liquidity
Canadian Pacific exited the second quarter with cash and cash equivalents of C$366 million compared with C$409 million at the prior-quarter end.
Long-term debt amounted to C$22.25 billion compared with C$21.88 billion at the prior-quarter end.
Net cash provided by operating activities increased 27.4% year over year to C$1.73 billion during the second quarter. Capital expenditures totaled C$758 million compared with C$743 million in the year-ago period.
During the first six months of 2026, the company returned C$2.37 billion to shareholders through share repurchases and dividends, up 11% year over year.
CP Offers 2026 Outlook
Canadian Pacific continues to expect 2026 core adjusted earnings per share (EPS) to grow in the low double digits from the 2025 level of C$4.61.
The company expects 2026 revenue ton-miles to increase in the mid-single digits from the 2025 actual.
Management continues to anticipate capital expenditures of approximately C$2.65 billion for 2026, representing a roughly 15% decline from 2025. The core adjusted effective tax rate is expected to be approximately 24.75%.
CPKC expects improving freight fundamentals, commercial wins, integration benefits and disciplined cost control to support accelerated volume and earnings growth in the second half of 2026.
Westinghouse Air Brake Technologies (WAB - Free Report) , operating as Wabtec Corporation, reported encouraging second-quarter 2026 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate and increased year over year.
Quarterly adjusted EPS of $2.76 beat the Zacks Consensus Estimate of $2.63 by 4.9% and increased 21.6% year over year, owing to higher sales and operating margin expansion.
Revenues climbed 17.5% to $3.18 billion and surpassed the consensus mark of $3.08 billion by 3.2%.
United Airlines Holdings, Inc. (UAL - Free Report) reported second-quarter 2026 adjusted EPS of $1.99, down 48.6% year over year but above the Zacks Consensus Estimate of $1.92 by 3.7%.
Operating revenues rose 16% to $17.67 billion and were essentially in line with the $17.68 billion consensus mark. A 12.1% increase in total revenues per available seat mile or TRASM, and broad-based gains across premium, loyalty and cargo revenues, supported the top line despite sharply higher fuel costs.
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CP Shares Decline 2.6% Since Second-Quarter 2026 Earnings Release
Key Takeaways
Canadian Pacific Kansas City Limited (CP - Free Report) reported better-than-expected second-quarter 2026 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
However, the company’s stock has declined 2.6% since its earnings release on July 29, 2026.
Quarterly earnings of 92 cents per share beat the Zacks Consensus Estimate of 89 cents by 3.4%. The bottom line increased 13% year over year on a core adjusted basis.
Operating revenues of $3.01 billion surpassed the consensus estimate of $2.91 billion by 3.3%. In Canadian dollars, revenues increased 13% year over year to C$4.16 billion.
Canadian Pacific Kansas City Limited Price, Consensus and EPS Surprise
Canadian Pacific Kansas City Limited price-consensus-eps-surprise-chart | Canadian Pacific Kansas City Limited Quote
In the reported quarter, total freight revenues per revenue ton-mile increased 9% year over year. Total freight revenues per carload rose 12%, reflecting favorable pricing and business mix.
On a reported basis, operating income increased 10% year over year to C$1.47 billion. However, total operating expenses rose 14% to C$2.69 billion, mainly due to a 53% increase in fuel expenses. The reported operating ratio deteriorated 90 basis points to 64.6%, while the core adjusted operating ratio worsened by the same magnitude to 61.6%.
Volumes, measured in revenue ton-miles, increased 4% year over year to 57.58 billion. Average train speed improved 7%, while average terminal dwell declined 16%, indicating stronger network efficiency.
CP’s Segmental Highlights
Freight revenues, which accounted for 98% of the top line, increased 13% year over year to C$4.09 billion.
CP’s freight business comprises Grain (up 24%), Coal (down 18%), Potash (up 10%), Fertilizers and Sulphur (up 12%), Forest Products (up 2%), Energy, Chemicals and Plastics (up 9%), Metals, Minerals and Consumer Products (up 18%), Automotive (up 22%) and Intermodal (up 11%).
Grain benefited from a record Canadian harvest and strong U.S. export demand. Automotive revenues gained from new business wins, while domestic intermodal benefited from the company’s SMX service and improving truck-to-rail conversion opportunities. Coal remained the primary weak spot due to lower mine production and shipment volumes.
Non-freight revenues increased 8.6% year over year to C$76 million in the second quarter.
CP’s Liquidity
Canadian Pacific exited the second quarter with cash and cash equivalents of C$366 million compared with C$409 million at the prior-quarter end.
Long-term debt amounted to C$22.25 billion compared with C$21.88 billion at the prior-quarter end.
Net cash provided by operating activities increased 27.4% year over year to C$1.73 billion during the second quarter. Capital expenditures totaled C$758 million compared with C$743 million in the year-ago period.
During the first six months of 2026, the company returned C$2.37 billion to shareholders through share repurchases and dividends, up 11% year over year.
CP Offers 2026 Outlook
Canadian Pacific continues to expect 2026 core adjusted earnings per share (EPS) to grow in the low double digits from the 2025 level of C$4.61.
The company expects 2026 revenue ton-miles to increase in the mid-single digits from the 2025 actual.
Management continues to anticipate capital expenditures of approximately C$2.65 billion for 2026, representing a roughly 15% decline from 2025. The core adjusted effective tax rate is expected to be approximately 24.75%.
CPKC expects improving freight fundamentals, commercial wins, integration benefits and disciplined cost control to support accelerated volume and earnings growth in the second half of 2026.
Currently, Canadian Pacific has a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Q2 Performances of Other Transportation Companies
Westinghouse Air Brake Technologies (WAB - Free Report) , operating as Wabtec Corporation, reported encouraging second-quarter 2026 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate and increased year over year.
Quarterly adjusted EPS of $2.76 beat the Zacks Consensus Estimate of $2.63 by 4.9% and increased 21.6% year over year, owing to higher sales and operating margin expansion.
Revenues climbed 17.5% to $3.18 billion and surpassed the consensus mark of $3.08 billion by 3.2%.
United Airlines Holdings, Inc. (UAL - Free Report) reported second-quarter 2026 adjusted EPS of $1.99, down 48.6% year over year but above the Zacks Consensus Estimate of $1.92 by 3.7%.
Operating revenues rose 16% to $17.67 billion and were essentially in line with the $17.68 billion consensus mark. A 12.1% increase in total revenues per available seat mile or TRASM, and broad-based gains across premium, loyalty and cargo revenues, supported the top line despite sharply higher fuel costs.