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Canadian Pacific Kansas City (TSE:CP) Reports Robust Q1 Revenue, Earnings Growth
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Canadian Pacific Kansas City (TSE:CP) Reports Robust Q1 Revenue, Earnings Growth

Story Highlights

Canadian Pacific Kansas City recently reported its Q1 results, which missed expectations ever so slightly but showed robust growth, nonetheless.

Canadian Pacific Kansas City (TSE:CP) (NYSE:CP), also known as CPKC following CP’s US$31 billion Kansas City Southern acquisition, recently reported its Q1-2023 earnings results, revealing strong growth in both revenues and earnings per share (EPS), although both figures came in slightly below expectations. 

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For the quarter, the company posted revenues of C$2.27 billion (versus analysts’ expectations of C$2.28 billion), a 23% increase from last year’s C$1.84 billion.

Meanwhile, CPKC’s core adjusted diluted EPS, which excludes significant items and accounting related to the acquisition, rose to C$0.90, up from C$0.67 in the prior year. Additionally, volumes increased by 11% year-over-year. Further, the company’s adjusted operating ratio (operating expenses divided by revenues — the lower, the better) improved by 690 basis points, hitting 62.9% compared to 69.8% in Q1-2022.

Keith Creel, CPKC President and CEO, noted, “Our strong bulk franchise, fueled by a robust Canadian grain harvest, plus competitive service offerings in intermodal helped produce these results providing momentum as we begin our journey as CPKC.”

Is CP Stock a Buy, According to Analysts?

Turning to Wall Street, Canadian Pacific Rail stock comes in as a Strong Buy based on 12 Buys and four Holds assigned in the past three months. The average CP stock price target of C$118.60 implies 12.2% upside potential.

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