Canadian Pacific Kansas City (NYSE:CP) Releases Earnings Results, Misses Expectations By $0.03 EPS

Canadian Pacific Kansas City (NYSE:CP) (TSE:CP) released its earnings results on Wednesday. The transportation company reported $0.91 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.94 by ($0.03), reports. The firm had revenue of $2.96 billion during the quarter, compared to analyst estimates of $2.96 billion. Canadian Pacific Kansas City had a net margin of 24.14% and a return on equity of 9.22%. Canadian Pacific Kansas City’s quarterly revenue was up 15.2% on a year-over-year basis. During the same quarter in the previous year, the firm earned $1.10 EPS.

Here are the key takeaways from Canadian Pacific Kansas City’s conference call:

• CPKC reported 6% volume growth, CAD 4.2 billion in revenue, a 61.9% core adjusted operating ratio, and 16% growth in adjusted EPS. Management said the company remains on track for mid-single-digit volume growth and a strong finish to the year.
• Operating performance improved across key metrics, including an 8% increase in train speed, 7% lower dwell, 10% higher car miles per car day, and 3% better fuel efficiency. CPKC also expects a sub-60% operating ratio in the fourth quarter.
• Commercial momentum remained broad-based, with record grain and intermodal performance, continued growth in the Canada-Mexico land bridge, and a new five-year Elk Valley Resources agreement that will return roughly half of certain coal traffic to CPKC’s network. Management highlighted additional opportunities in domestic intermodal, Mexico, Saint John, and port-related traffic.
• Higher fuel prices were a significant headwind, driving a 56% increase in fuel expense and adding 190 basis points to the quarterly adjusted operating ratio. Executives also acknowledged that elevated fuel surcharges are creating price sensitivity and may push some customers toward alternative transportation modes.
• Personal injury frequency rose 20% year over year to 1.12, despite a 60% improvement in train accidents. Management said the increase in employee injuries did not meet its safety standards and that corrective efforts would remain a priority.

Canadian Pacific Kansas City Stock Up 1.2%

CP stock traded up $1.05 during trading on Friday, reaching $89.42. The stock had a trading volume of 524,317 shares, compared to its average volume of 2,646,031. Canadian Pacific Kansas City has a one year low of $68.42 and a one year high of $96.90. The company has a quick ratio of 0.50, a current ratio of 0.59 and a debt-to-equity ratio of 0.47. The company’s 50 day moving average is $88.86 and its two-hundred day moving average is $85.81. The company has a market capitalization of $78.25 billion, a price-to-earnings ratio of 28.77, a P/E/G ratio of 1.89 and a beta of 1.13.

Canadian Pacific Kansas City Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Monday, January 25th. Shareholders of record on Thursday, December 31st will be given a C$0.27 dividend. This represents a $1.07 dividend on an annualized basis and a yield of 1.2%. The ex-dividend date of this dividend is Thursday, December 31st. Canadian Pacific Kansas City’s dividend payout ratio is presently 24.76%.

Trending Headlines about Canadian Pacific Kansas City

Here are the key news stories impacting Canadian Pacific Kansas City this week:

• Positive Sentiment: Expanded Elk Valley Resources agreement: CPKC signed a new five-year agreement with Elk Valley Resources that increases its share of steelmaking-coal shipments to West Coast terminals. The contract provides greater long-term freight visibility and supports volumes across the company’s North American network. CPKC and EVR renew and expand rail service agreement
• Positive Sentiment: Solid revenue growth and operating momentum: Third-quarter revenue rose 15.2% year over year. Company materials highlighted record intermodal performance and maintained a positive outlook for 2026, suggesting strength in the integrated Canada-U.S.-Mexico network despite broader economic headwinds. CPKC reported diluted EPS of $1.04 and core adjusted diluted EPS of $1.28 in its company release. CPKC reports solid third quarter results
• Positive Sentiment: Dividend declared: CPKC declared a quarterly dividend of C$0.268 per share, payable January 25, 2027. The annualized payout is approximately C$1.07, representing a yield near 1.2% and providing modest shareholder-income support. Canadian Pacific Kansas City Limited declares dividend
• Neutral Sentiment: BlackRock ownership disclosure: BlackRock reported a 5.02% ownership stake in CPKC. The filing confirms significant institutional participation but does not necessarily indicate a new bullish view or a change in the company’s fundamentals. BlackRock announces ownership stake
• Negative Sentiment: Quarterly earnings miss: Several reports said CPKC earned $0.91 per share, below the $0.94 consensus estimate and down from $1.10 a year earlier, even though revenue matched estimates at $2.96 billion. The earnings shortfall raises concerns about margins and near-term profitability. CPKC lags Q3 earnings estimates
• Negative Sentiment: Lower analyst price target: Stephens reduced its target from $96 to $93 and maintained an “equal weight” rating. The revised target still implies upside from recent levels, but the downgrade reflects limited conviction and could weigh on sentiment. Stephens analyst rating

Wall Street Analyst Weigh In

A number of research firms have commented on CP. Weiss Ratings cut shares of Canadian Pacific Kansas City from a “buy (b)” rating to a “buy (b-)” rating in a report on Thursday. Citigroup reaffirmed a “cautious” rating on shares of Canadian Pacific Kansas City in a research report on Wednesday, October 7th. Royal Bank Of Canada reaffirmed an “outperform” rating on shares of Canadian Pacific Kansas City in a research note on Thursday, September 24th. Evercore reissued an “outperform” rating and issued a $96.00 price objective on shares of Canadian Pacific Kansas City in a research note on Thursday. Finally, Wall Street Zen raised Canadian Pacific Kansas City from a “sell” rating to a “hold” rating in a research report on Sunday, July 26th. One research analyst has rated the stock with a Strong Buy rating, twelve have given a Buy rating and four have assigned a Hold rating to the company. Based on data from MarketBeat.com, Canadian Pacific Kansas City currently has an average rating of “Moderate Buy” and a consensus price target of $112.00.

About Canadian Pacific Kansas City

Canadian Pacific Kansas City Limited (NYSE: CP) is a North American transportation company that operates Canadian Pacific Kansas City (CPKC), a Class I freight railway. The company was created in 2023 through the combination of Canadian Pacific and Kansas City Southern, forming the first single-line railroad connecting Canada, the United States and Mexico.

CPKC transports a broad range of freight, including grain and fertilizers, coal, forest products, automotive goods, energy and chemicals, industrial and consumer products, and intermodal shipments.