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Canadian Pacific Kansas City Keeps Quarterly Dividend at CA$0.268 ($0.19) per Share, Payable on Oct. 26 to Holders of Record as of Sept. 25
Railroad companies Canadian National Railway (CNI), CSX (CSX), and Union Pacific (UNP) are well-positioned to beat second-quarter earnings expectations amid strong volume trends, RBC Capital Markets said Wednesday in a report.Canadian National's year-to-date volumes are trending up 3.6%, setting the stage for a projected second-quarter profit of $1.95 a share, the report said. Union Pacific's profit is expected to be $3.28 a share, and CSX is projected to earn $0.51 a share, RBC said."Overall, we see Canadian National, CSX, and Union Pacific as delivering the best earnings upside versus consensus given strong volume trends," the report said.RBC had a more cautious tone on Canadian Pacific Kansas City (CP) and predicted a "near-term neutral reaction" as a mix of strong operating metrics and stable volumes may be offset by recent derailments and rising share-based compensation costs.CSX will report results on July 22, followed by Canadian National Railway on July 24.RBC raised its price targets to $195 from $178 for Canadian National, to $139 from $127 for Canadian Pacific, and to $51 from $47 on CSX "due to indications the freight backdrop is improving."RBC lowered its price target for Norfolk Southern (NSC) after applying a 10% discount due to higher deal-related risk, noting that it continues "to see quarterly results as less impactful to sentiment given the proposed merger with Union Pacific."Last year, Union Pacific agreed to acquire Norfolk Southern in a cash-and-stock deal valuing the smaller railroad operator at about $85 billion. The deal faces regulatory headwinds after the US Surface Transportation Board paused review of the deal in late May, giving the companies until July 27 to provide more comprehensive traffic and market-competition data.Price: $116.07, Change: $+1.17, Percent Change: +1.02%
BHP Group's (BHP) BHP Canada subsidiary said Thursday it signed transportation agreements with Canadian National Railway (CNI) and Canadian Pacific Kansas City (CP) that will help move potash from its Jansen project in Saskatchewan to Westshore Terminals in Vancouver for export.Both Canadian National and Canadian Pacific will operate unit trains between Jansen and Westshore Terminals under roughly four-year contracts, BHP said."The Jansen Potash Mine project represents a generational investment in Saskatchewan and a significant opportunity for Canada's export economy," CN Chief Commercial Officer Janet Drysdale said."We are pleased to enter into this agreement with BHP as they expand into the potash market," said Canadian Pacific President and CEO Keith Creel. "We look forward to providing our industry-leading service to BHP helping to drive innovation and reliability across the potash supply chain."Price: $89.55, Change: $-1.30, Percent Change: -1.43%
BHP Signs Potash Transport Deals With Canadian National Railway, Canadian Pacific Kansas City
Canadian Pacific Kansas City (CP.TO, CP) on Monday said it set a April record for shipments of Canadian grain and grain products, moving 2.9 million tonnes (MMT) last month, surpassing the previous tonnage record set in April 2020.Last month's 30,381 carloads also set a new April monthly record, beating the previous high set in April 2020, the company said.First quarter totals of 7.2 MMT beat the previous record quarter reached in the first quarter of 2021. Through the first 38 weeks of the 2025-2026 crop year, CPKC transported more than 21.9 MMT of Canadian grain and grain products, said the company adding these are the largest Canadian grain totals since the record setting 2020-2021 crop year."We have started 2026 with a record first quarter for the movement of Canadian grain and have set monthly records in three of the first four months of the year as we move a record grain crop across Western Canada," said Elizabeth Hucker, vice-president sales and marketing bulk. "Our ability to safely and efficiently deliver record grain volumes comes from sustained investments in the grain supply chain and working closely with our customers across our network."The company's shares closed down $4.09 to $113.07 on the Toronto Stock Exchange.
RBC Capital Markets raised its price target on Canadian National Railway Co. (CNR.TO, CNI) to $178 from $160, and lowered its target on Canadian Pacific Kansas City Ltd. (CP.TO, CP) to $127 from $128.Analyst Walter Spracklin maintained an Outperform rating on both Canadian-based railways following their quarterly results."While CN delivered an inline result vs consensus (note that estimates moved higher into the quarter report), expectations for higher operating leverage following the strong performance across US peers did not materialize in Q1, leading to an early sell-off in the shares," Spracklin said in a note to clients."Key is that we believe this to be a knee-jerk reaction to the headline result, as management did a good job on the call to flag what we characterize as discreet Q1 costs," the analyst said."We expect operating leverage to pick up through the course of the year and see upside to guidance and consensus numbers.""We expect CP shares to come under some pressure on the back of Q1 results that were below expectations and trends that put full year guidance at risk," Spracklin said."Notable was a coal production issue at a major customer, which was called out as a 100bp headwind to volumes," the analyst said."While management guided to a strong sequential improvement in Q2, we are taking our numbers down to the very low end of management guidance for MSD volume and LDD EPS, with risk to the downside."
CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:CP reported Q1 adjusted EPS of $1.04, beating consensus by $0.26. Total revenues declined 2% to $3.7B despite 2% RTM growth, as pricing pressure drove freight revenue per RTM down 4%. Operating income decreased 4% to $1.3B, and the operating ratio expanded 70 bps to 66.0%, reflecting continued KCS integration costs, including $91M in purchase accounting amortization. The company's 20,000-mile transcontinental network provides competitive advantages despite near-term volume constraints from broader economic conditions.Operationally, CP demonstrated improved network fluidity: average train speed increased 4% to 19.9 mph, terminal dwell improved 8% to 9.5 hours, and locomotive productivity advanced 5%. Business line performance was mixed. Grain revenues advanced 11% to $871M on robust Canadian production, while industrial segments faced headwinds reflecting market softness: energy, chemicals, and plastics declined 8% to $700M, and coal fell 12% to $226M.
CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:CP reported Q1 adjusted EPS of $1.04, beating consensus by $0.26. Total revenues declined 2% to $3.7B despite 2% RTM growth, as pricing pressure drove freight revenue per RTM down 4%. Operating income decreased 4% to $1.3B, and the operating ratio expanded 70 bps to 66.0%, reflecting continued KCS integration costs, including $91M in purchase accounting amortization. The company's 20,000-mile transcontinental network provides competitive advantages despite near-term volume constraints from broader economic conditions.Operationally, CP demonstrated improved network fluidity: average train speed increased 4% to 19.9 mph, terminal dwell improved 8% to 9.5 hours, and locomotive productivity advanced 5%. Business line performance was mixed. Grain revenues advanced 11% to $871M on robust Canadian production, while industrial segments faced headwinds reflecting market softness: energy, chemicals, and plastics declined 8% to $700M, and coal fell 12% to $226M.
Canadian Pacific Kansas City (CP.TO, CP) after the close Wednesday reported a 6.4% year-over-year decline in first-quarter adjusted net income as lower revenue led the company to miss analysts' estimates.Core adjusted net income, excluding most one-time items, for the three months ended March 31 ,was C$929 million, or C$1.04 per share, down from C$992 million, or C$1.06 per share, a year earlier. The result missed FactSet's consensus analysts estimate of C$1.07 per share.Revenue for the quarter fell 2.5% year over year to C$3.70 billion from C$3.78 billion, also below FactSet's estimate of C$3.75 billion.The railway's core operating ratio, an efficiency measure where lower is better, rose 50 basis points to 63% from 62.5%.Volumes, measured by revenue ton-miles, rose 2%, while the core adjusted operating ratio increased 50 basis points to 63.0% from 62.5%."Our talented team of world-class railroaders executed our precision scheduled railroading plan with discipline, driving meaningful improvements in network fluidity, terminal performance and other key operating metrics, while delivering solid first-quarter results," said chief executive Keith Creel."Despite ongoing market and macroeconomic headwinds, we delivered volume growth demonstrating the resiliency and competitive advantage of our unrivalled North American network," he added.Additionally, on Tuesday, the company said its board approved a 17.5% increase in its quarterly dividend to 26.8 Canadian cents per share from 22.8 cents per share.Company's shares dropped US$1.18 to US$83.10 in after-hours trade on Nasdaq after closing down C$3.34 at C$115.30 on Toronto Stock Exchange.
Raymond James raised its price target on Canadian National Railway (CNR.TO, CNI) to $170 from $162, and on Canadian Pacific Kansas City (CP.TO, CP) to $125 from $120 on Thursday.Analyst Steve Hansen maintained an Outperform rating on both Canadian railways."Canadian rail traffic is off to a better-than-expected start in 2026," Hansen said in a note to clients. "While January struggled (acute weather), traffic accelerated through February/ March driven by sustained tailwinds in Grain, Intermodal, and PetChem.""Both Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC) outperformed our expectations," the analyst said."After an underwhelming FY26 volume guide ('flattish'), CN stood out, in particular, outperforming not only Street expectations, but also its closest peer for a 2nd consecutive quarter. Share price performance followed," Hansen said."Looking forward, we remain cautiously optimistic on both carriers. While the threat of further US trade action still lingers, we see a realistic path to LSD to MSD traffic growth underpinned by: 1) sustained bulk tailwinds (grain, potash); 2) incremental self-help traction; and 3) a rapidly improving economic/freight outlook south of the border. At the same time, emerging inflections in key categories (PetChem, Forestry, FracSand) are expected to influence the growth and yield mix."
