Want to see TSE:CP full AI Analyst Report?
Top Page
Canadian Pacific Kansas City
(TSX:CP)
Select Model
Select Model
Rating:71Outperform
Price Target:
C$137.00
â–²(4.96% Upside)
Action:Reiterated
Date:10/30/26
The score is driven primarily by solid financial performance (strong profitability and rising TTM free cash flow, despite weaker recent revenue trend and mixed cash conversion) and a very constructive earnings call with supportive growth/efficiency guidance. These positives are partially offset by a neutral technical setup and a less attractive valuation (higher P/E and low dividend yield).
Positive Factors
Cross-Border Network Growth
The Canada-Mexico land bridge is a durable advantage of CPKC’s single-line network, linking major North American markets without interchange. Scaling from approximately $100 million to more than $600 million in annual revenue could broaden cross-border growth and improve network utilization over time.
Negative Factors
Recent Revenue and Margin Pressure
The recent decline in revenue and margin compression show that strong historical growth has not translated consistently into the latest period. If weaker volumes or unfavorable mix persist, operating leverage could work against CPKC and temper earnings growth over the next several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Cross-Border Network Growth
The Canada-Mexico land bridge is a durable advantage of CPKC’s single-line network, linking major North American markets without interchange. Scaling from approximately $100 million to more than $600 million in annual revenue could broaden cross-border growth and improve network utilization over time.
Read all positive factors
Canadian Pacific Kansas City (CP) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$108.74B
Dividend Yield0.8%
Average Volume (3M)1.18M
Price to Earnings (P/E)28.4
Beta (1Y)0.67
Revenue Growth6.51%
EPS Growth-5.73%
CountryCA
Employees19,687
SectorIndustrials
Sector Strength72
IndustryRailroads
Share Statistics
EPS (TTM)4.35
Shares Outstanding879,079,200
10 Day Avg. Volume1,050,821
30 Day Avg. Volume1,178,781
Financial Highlights & Ratios
PEG Ratio1.65
Price to Book (P/B)2.02
Price to Sales (P/S)6.14
P/FCF Ratio42.68
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$141.03Price Target Upside8.05% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering19
EPS Forecast (FY)5.15
Revenue Forecast (FY)C$16.50B
Canadian Pacific Kansas City Business Overview & Revenue Model
Company Description
Canadian Pacific Kansas City Ltd. provides essential rail freight transportation services. The firm operates an extensive railway network, creating vital connections between Canada, the United States, and Mexico. Established on June 22, 2001, the ...
How the Company Makes Money
CPKC primarily makes money by charging customers to move freight by rail across its network. Its revenue model is centered on contractual and tariff-based transportation rates that generally reflect shipment distance, car type, service requirement...
Canadian Pacific Kansas City Earnings Call Summary
Earnings Call Date:Oct 28, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Feb 02, 2027
Earnings Call Sentiment Positive
The call was strongly positive overall. Management reported solid revenue, volume, earnings, productivity, cash flow, pricing, and intermodal and grain growth, while highlighting multiple capacity and commercial opportunities for the remainder of 2026 and beyond. The principal challenges were higher fuel costs, increased personal injury frequency, coal and automotive volume pressure, tougher future grain comparisons, and uncertainty around certain markets and the proposed U.S. rail merger.Positive Updates
Strong Third-Quarter Financial Performance
Third-quarter revenue was $4.2 billion, volume growth was 6%, and the core adjusted operating ratio was 61.9%. Core adjusted diluted EPS was $1.28, up 16% year over year, despite margin pressure from higher fuel prices.
Negative Updates
Higher Personal Injury Frequency
Personal injury frequency was 1.12, which was 20% higher than last year. Management said the increase did not meet its standard and that it would reinforce safety fundamentals.
Read all updates
Q3-2026 Updates
Positive
Negative
Strong Third-Quarter Financial Performance
Third-quarter revenue was $4.2 billion, volume growth was 6%, and the core adjusted operating ratio was 61.9%. Core adjusted diluted EPS was $1.28, up 16% year over year, despite margin pressure from higher fuel prices.
Read all positive updates
Company Guidance
CPKC said it remains well on track for another year of mid-single-digit volume growth and expects the Canada-Mexico land bridge to exit this year north of $600 million in annual revenue; it expects continued grain volume growth through the end of the year and into early 2027, a return to solid growth for potash for the remainder of the year, automotive volume growth for the fourth quarter and into 2027, and a full year headcount down slightly. Guidance includes full year CapEx of approximately $2.65 billion, a 15% reduction versus last year, a long-term $2.6 billion to $2.8 billion range of CapEx, a full year core adjusted effective tax rate of approximately 24.75%, a sub-60 OR in Q4, and high single-digit cents per RTM improvement year-over-year; the company also expects to bring on 300 new locomotives through 2028, with next year’s Canadian grain crop narrowing in on the 76 million to 78 million metric ton area, or about 8% or so down.Canadian Pacific Kansas City Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
71
Positive
Cash Flow
77
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 16.01B | 15.08B | 14.55B | 12.55B | 8.81B | 8.00B |
| Gross Profit | 6.04B | 6.08B | 7.54B | 6.44B | 4.59B | 4.59B |
| EBITDA | 8.32B | 8.37B | 7.47B | -739.00M | 5.65B | 4.87B |
| Net Income | 3.86B | 4.14B | 3.72B | 3.93B | 3.52B | 2.85B |
Balance Sheet | ||||||
| Total Assets | 89.44B | 85.94B | 88.40B | 80.39B | 73.75B | 68.35B |
| Cash, Cash Equivalents and Short-Term Investments | 399.00M | 184.00M | 739.00M | 464.00M | 451.00M | 82.00M |
| Total Debt | 25.85B | 23.19B | 22.99B | 22.84B | 19.92B | 20.41B |
| Total Liabilities | 42.69B | 39.12B | 39.51B | 37.98B | 34.86B | 34.52B |
| Stockholders Equity | 45.78B | 45.88B | 47.89B | 41.49B | 38.89B | 33.83B |
Cash Flow | ||||||
| Free Cash Flow | 2.93B | 2.17B | 2.41B | 1.64B | 2.58B | 2.16B |
| Operating Cash Flow | 5.78B | 5.31B | 5.27B | 4.14B | 4.14B | 3.69B |
| Investing Cash Flow | -2.78B | -2.67B | -2.80B | -2.16B | -1.50B | -13.73B |
| Financing Cash Flow | -3.03B | -3.15B | -2.25B | -1.96B | -2.30B | 9.94B |
Canadian Pacific Kansas City Technical Analysis
Negative
130.53
Price Trends
124.61
Negative
125.36
Negative
118.83
Positive
Market Momentum
0.56
Negative
49.14
Neutral
66.54
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CP, the sentiment is Negative. The current price of 130.53 is above the 20-day moving average (MA) of 123.11, above the 50-day MA of 124.61, and above the 200-day MA of 118.83, indicating a neutral trend. The MACD of 0.56 indicates Negative momentum. The RSI at 49.14 is Neutral, neither overbought nor oversold. The STOCH value of 66.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:CP.
Canadian Pacific Kansas City Risk Analysis
Canadian Pacific Kansas City disclosed 25 risk factors in its most recent earnings report. Canadian Pacific Kansas City reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Canadian Pacific Kansas City Peers Comparison
UnderperformOutperform
Sector (63)
TSE:CP
Canadian Pacific Kansas City
123.70
22.95
22.78%
TSE:CNR
Canadian National Railway
173.68
46.18
36.22%
Canadian Pacific Kansas City Corporate Events
Business Operations and StrategyFinancial Disclosures
CPKC Books Double-Digit Revenue Growth in Third Quarter Despite Higher Fuel Costs
Positive
Oct 28, 2026
Canadian Pacific Kansas City reported third-quarter 2026 revenues of $4.2 billion, up 15 percent year over year, with diluted EPS rising to $1.04 and core adjusted diluted EPS advancing 16 percent to $1.28. Volumes increased 6 percent in revenue t...
Business Operations and StrategyPrivate Placements and Financing
CPKC unit launches C$1.8 billion Canadian debt offering
Positive
Sep 29, 2026
Canadian Pacific Kansas City’s subsidiary Canadian Pacific Railway Company is tapping the Canadian debt market with a C$1.8 billion multi-tranche note offering that will be guaranteed by the parent. The issuance, comprising notes maturing be...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.