CANADIAN PACIFIC KANSAS CITY (CP.CA) Stock Fundamental Analysis
TSX:CP - Toronto Stock Exchange - CA13646K1084 - Common Stock - Currency: CAD
Overall CP gets a fundamental rating of 4 out of 10. We evaluated CP against 5 industry peers in the Ground Transportation industry. While CP is still in line with the averages on profitability rating, there are concerns on its financial health. While showing a medium growth rate, CP is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year CP was profitable.
CP had a positive operating cash flow in the past year.
CP had positive earnings in each of the past 5 years.
In the past 5 years CP always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of CP (4.24%) is worse than 60.00% of its industry peers.
CP has a worse Return On Equity (7.76%) than 60.00% of its industry peers.
With a Return On Invested Capital value of 4.92%, CP is not doing good in the industry: 60.00% of the companies in the same industry are doing better.
Measured over the past 3 years, the Average Return On Invested Capital for CP is below the industry average of 7.36%.
The last Return On Invested Capital (4.92%) for CP is above the 3 year average (4.45%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.24% | ||
| ROE | 7.76% | ||
| ROIC | 4.92% |
ROA(3y)4.65%
ROA(5y)5.69%
ROE(3y)8.76%
ROE(5y)13.62%
ROIC(3y)4.45%
ROIC(5y)5.79%
1.3 Margins
CP has a better Profit Margin (25.56%) than 80.00% of its industry peers.
In the last couple of years the Profit Margin of CP has declined.
With a decent Operating Margin value of 36.40%, CP is doing good in the industry, outperforming 80.00% of the companies in the same industry.
CP's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 84.86%, CP belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
CP's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36.4% | ||
| PM (TTM) | 25.56% | ||
| GM | 84.86% |
OM growth 3Y-3.17%
OM growth 5Y-1.91%
PM growth 3Y-10.52%
PM growth 5Y-3.98%
GM growth 3Y-0.68%
GM growth 5Y-0.26%
2. Health
2.1 Basic Checks
CP has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for CP remains at a similar level compared to 1 year ago.
The number of shares outstanding for CP has been increased compared to 5 years ago.
CP has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.22 indicates that CP is not a great score, but indicates only limited risk for bankruptcy at the moment.
CP has a Altman-Z score (2.22) which is comparable to the rest of the industry.
CP has a debt to FCF ratio of 9.40. This is a negative value and a sign of low solvency as CP would need 9.40 years to pay back of all of its debts.
The Debt to FCF ratio of CP (9.40) is worse than 60.00% of its industry peers.
A Debt/Equity ratio of 0.45 indicates that CP is not too dependend on debt financing.
CP has a Debt to Equity ratio of 0.45. This is amongst the best in the industry. CP outperforms 100.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 9.4 | ||
| Altman-Z | 2.22 |
ROIC/WACC0.62
WACC7.98%
2.3 Liquidity
CP has a Current Ratio of 0.60. This is a bad value and indicates that CP is not financially healthy enough and could expect problems in meeting its short term obligations.
CP's Current ratio of 0.60 is on the low side compared to the rest of the industry. CP is outperformed by 60.00% of its industry peers.
A Quick Ratio of 0.52 indicates that CP may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.52, CP is in line with its industry, outperforming 60.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.52 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.77% over the past year.
The Earnings Per Share has been growing slightly by 5.28% on average over the past years.
Looking at the last year, CP shows a quite strong growth in Revenue. The Revenue has grown by 15.86% in the last year.
The Revenue has been growing by 13.30% on average over the past years. This is quite good.
EPS 1Y (TTM)12.77%
EPS 3Y4.29%
EPS 5Y5.28%
EPS Q2Q%10%
Revenue 1Y (TTM)15.86%
Revenue growth 3Y22.08%
Revenue growth 5Y13.3%
Sales Q2Q%3.82%
3.2 Future
CP is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.86% yearly.
The Revenue is expected to grow by 6.22% on average over the next years.
EPS Next Y17.65%
EPS Next 2Y16.41%
EPS Next 3Y15.96%
EPS Next 5Y12.86%
Revenue Next Year6.68%
Revenue Next 2Y6.83%
Revenue Next 3Y7.09%
Revenue Next 5Y6.22%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 25.82, CP can be considered very expensive at the moment.
Based on the Price/Earnings ratio, CP is valued a bit more expensive than 60.00% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.03, CP is valued at the same level.
A Price/Forward Earnings ratio of 19.46 indicates a rather expensive valuation of CP.
CP's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. CP is more expensive than 60.00% of the companies in the same industry.
CP's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 21.94.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.82 | ||
| Fwd PE | 19.46 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CP is valued a bit more expensive than the industry average as 60.00% of the companies are valued more cheaply.
CP's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. CP is more expensive than 60.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 43.59 | ||
| EV/EBITDA | 17.4 |
4.3 Compensation for Growth
CP's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
CP's earnings are expected to grow with 15.96% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.46
PEG (5Y)4.89
EPS Next 2Y16.41%
EPS Next 3Y15.96%
5. Dividend
5.1 Amount
With a yearly dividend of 0.70%, CP is not a good candidate for dividend investing.
CP's Dividend Yield is slightly below the industry average, which is at 2.74.
Compared to an average S&P500 Dividend Yield of 2.36, CP's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.7% |
5.2 History
The dividend of CP has a limited annual growth rate of 5.07%.
CP has been paying a dividend for at least 10 years, so it has a reliable track record.
CP has decreased its dividend recently.
Dividend Growth(5Y)5.07%
Div Incr Years0
Div Non Decr Years1
5.3 Sustainability
CP pays out 19.07% of its income as dividend. This is a sustainable payout ratio.
The dividend of CP is growing, but earnings are growing more, so the dividend growth is sustainable.
DP19.07%
EPS Next 2Y16.41%
EPS Next 3Y15.96%
TSX:CP (5/21/2025, 7:00:00 PM)
112.32
-1.72 (-1.51%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryGround Transportation
Earnings (Last)
Earnings (Next)
Inst Owners74.87%
Inst Owner ChangeN/A
Ins Owners0.02%
Ins Owner ChangeN/A
Market Cap104.88B
Analysts82.29
Price Target123.56 (10.01%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.7% |
Yearly Dividend0.76
Dividend Growth(5Y)5.07%
DP19.07%
Div Incr Years0
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.68%
Min EPS beat(2)-4.38%
Max EPS beat(2)1.02%
EPS beat(4)2
Avg EPS beat(4)-1.21%
Min EPS beat(4)-4.38%
Max EPS beat(4)2.45%
EPS beat(8)3
Avg EPS beat(8)-3.07%
EPS beat(12)4
Avg EPS beat(12)-2.99%
EPS beat(16)4
Avg EPS beat(16)-3.31%
Revenue beat(2)0
Avg Revenue beat(2)-3.83%
Min Revenue beat(2)-4.24%
Max Revenue beat(2)-3.42%
Revenue beat(4)0
Avg Revenue beat(4)-3.31%
Min Revenue beat(4)-4.24%
Max Revenue beat(4)-2.2%
Revenue beat(8)0
Avg Revenue beat(8)-3.8%
Revenue beat(12)0
Avg Revenue beat(12)-3.87%
Revenue beat(16)0
Avg Revenue beat(16)-3.99%
PT rev (1m)-4.74%
PT rev (3m)-4.32%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-4.04%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.09%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.9%
Revenue NY rev (1m)-1.39%
Revenue NY rev (3m)-1.34%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.82 | ||
| Fwd PE | 19.46 | ||
| P/S | 7.21 | ||
| P/FCF | 43.59 | ||
| P/OCF | 19.9 | ||
| P/B | 2.19 | ||
| P/tB | 4.13 | ||
| EV/EBITDA | 17.4 |
EPS(TTM)4.35
EY3.87%
EPS(NY)5.77
Fwd EY5.14%
FCF(TTM)2.58
FCFY2.29%
OCF(TTM)5.64
OCFY5.02%
SpS15.58
BVpS51.29
TBVpS27.2
PEG (NY)1.46
PEG (5Y)4.89
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.24% | ||
| ROE | 7.76% | ||
| ROCE | 6.45% | ||
| ROIC | 4.92% | ||
| ROICexc | 4.97% | ||
| ROICexgc | 6.82% | ||
| OM | 36.4% | ||
| PM (TTM) | 25.56% | ||
| GM | 84.86% | ||
| FCFM | 16.54% |
ROA(3y)4.65%
ROA(5y)5.69%
ROE(3y)8.76%
ROE(5y)13.62%
ROIC(3y)4.45%
ROIC(5y)5.79%
ROICexc(3y)4.48%
ROICexc(5y)5.83%
ROICexgc(3y)5.71%
ROICexgc(5y)6.61%
ROCE(3y)5.78%
ROCE(5y)7.61%
ROICexcg growth 3Y21.06%
ROICexcg growth 5Y-10.7%
ROICexc growth 3Y9.14%
ROICexc growth 5Y-16%
OM growth 3Y-3.17%
OM growth 5Y-1.91%
PM growth 3Y-10.52%
PM growth 5Y-3.98%
GM growth 3Y-0.68%
GM growth 5Y-0.26%
F-Score7
Asset Turnover0.17
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 9.4 | ||
| Debt/EBITDA | 2.97 | ||
| Cap/Depr | 150.68% | ||
| Cap/Sales | 19.68% | ||
| Interest Coverage | 6.5 | ||
| Cash Conversion | 73.23% | ||
| Profit Quality | 64.71% | ||
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.52 | ||
| Altman-Z | 2.22 |
F-Score7
WACC7.98%
ROIC/WACC0.62
Cap/Depr(3y)165.06%
Cap/Depr(5y)179.72%
Cap/Sales(3y)19.08%
Cap/Sales(5y)19.62%
Profit Quality(3y)59.97%
Profit Quality(5y)60.36%
High Growth Momentum
Growth
EPS 1Y (TTM)12.77%
EPS 3Y4.29%
EPS 5Y5.28%
EPS Q2Q%10%
EPS Next Y17.65%
EPS Next 2Y16.41%
EPS Next 3Y15.96%
EPS Next 5Y12.86%
Revenue 1Y (TTM)15.86%
Revenue growth 3Y22.08%
Revenue growth 5Y13.3%
Sales Q2Q%3.82%
Revenue Next Year6.68%
Revenue Next 2Y6.83%
Revenue Next 3Y7.09%
Revenue Next 5Y6.22%
EBIT growth 1Y15.81%
EBIT growth 3Y18.2%
EBIT growth 5Y11.13%
EBIT Next Year49.14%
EBIT Next 3Y21.52%
EBIT Next 5Y14.37%
FCF growth 1Y46.89%
FCF growth 3Y3.72%
FCF growth 5Y12.37%
OCF growth 1Y27.36%
OCF growth 3Y12.63%
OCF growth 5Y12%