CANADIAN PACIFIC KANSAS CITY (CP) Stock Fundamental Analysis
NYSE:CP - New York Stock Exchange, Inc. - CA13646K1084 - Common Stock - Currency: USD
Overall CP gets a fundamental rating of 5 out of 10. We evaluated CP against 40 industry peers in the Ground Transportation industry. CP has a medium profitability rating, but doesn't score so well on its financial health evaluation. CP has a decent growth rate and is not valued too expensively.
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.
Each year in the past 5 years CP had a positive operating cash flow.
1.2 Ratios
CP's Return On Assets of 4.38% is in line compared to the rest of the industry. CP outperforms 57.50% of its industry peers.
Looking at the Return On Equity, with a value of 7.99%, CP is in line with its industry, outperforming 52.50% of the companies in the same industry.
CP has a Return On Invested Capital (5.00%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CP is below the industry average of 8.58%.
The last Return On Invested Capital (5.00%) for CP is above the 3 year average (4.45%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.38% | ||
| ROE | 7.99% | ||
| ROIC | 5% |
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
Looking at the Profit Margin, with a value of 26.00%, CP belongs to the top of the industry, outperforming 87.50% of the companies in the same industry.
In the last couple of years the Profit Margin of CP has declined.
CP's Operating Margin of 36.85% is amongst the best of the industry. CP outperforms 92.50% of its industry peers.
In the last couple of years the Operating Margin of CP has declined.
With an excellent Gross Margin value of 84.78%, CP belongs to the best of the industry, outperforming 95.00% 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 | 36.85% | ||
| PM (TTM) | 26% | ||
| GM | 84.78% |
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.
CP has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, CP has more shares outstanding
CP has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.23 indicates that CP is not a great score, but indicates only limited risk for bankruptcy at the moment.
CP has a Altman-Z score (2.23) which is in line with its industry peers.
The Debt to FCF ratio of CP is 9.62, which is on the high side as it means it would take CP, 9.62 years of fcf income to pay off all of its debts.
CP's Debt to FCF ratio of 9.62 is fine compared to the rest of the industry. CP outperforms 65.00% of its industry peers.
A Debt/Equity ratio of 0.46 indicates that CP is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.46, CP is in line with its industry, outperforming 42.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 9.62 | ||
| Altman-Z | 2.23 |
ROIC/WACC0.62
WACC8.01%
2.3 Liquidity
A Current Ratio of 0.81 indicates that CP may have some problems paying its short term obligations.
CP's Current ratio of 0.81 is on the low side compared to the rest of the industry. CP is outperformed by 72.50% of its industry peers.
A Quick Ratio of 0.70 indicates that CP may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.70, CP is doing worse than 82.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.81 | ||
| Quick Ratio | 0.7 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 13.73% over the past year.
CP shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.28% yearly.
The Revenue has been growing slightly by 7.33% in the past year.
CP shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 13.30% yearly.
EPS 1Y (TTM)13.73%
EPS 3Y4.29%
EPS 5Y5.28%
EPS Q2Q%13.98%
Revenue 1Y (TTM)7.33%
Revenue growth 3Y22.08%
Revenue growth 5Y13.3%
Sales Q2Q%7.81%
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 12.59% yearly.
Based on estimates for the next years, CP will show a small growth in Revenue. The Revenue will grow by 5.86% on average per year.
EPS Next Y17.65%
EPS Next 2Y16.41%
EPS Next 3Y15.96%
EPS Next 5Y12.59%
Revenue Next Year6.68%
Revenue Next 2Y6.83%
Revenue Next 3Y7.09%
Revenue Next 5Y5.86%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 24.30 indicates a rather expensive valuation of CP.
62.50% of the companies in the same industry are more expensive than CP, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of CP to the average of the S&P500 Index (27.50), we can say CP is valued inline with the index average.
The Price/Forward Earnings ratio is 18.48, which indicates a rather expensive current valuation of CP.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CP indicates a somewhat cheap valuation: CP is cheaper than 65.00% of the companies listed in the same industry.
CP's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 36.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.3 | ||
| Fwd PE | 18.48 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CP is valued a bit more expensive than 60.00% of the companies in the same industry.
CP's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. CP is cheaper than 62.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 42.16 | ||
| EV/EBITDA | 16.71 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of CP may justify a higher PE ratio.
CP's earnings are expected to grow with 15.96% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.38
PEG (5Y)4.6
EPS Next 2Y16.41%
EPS Next 3Y15.96%
5. Dividend
5.1 Amount
CP has a yearly dividend return of 0.71%, which is pretty low.
CP's Dividend Yield is comparable with the industry average which is at 1.47.
With a Dividend Yield of 0.71, CP pays less dividend than the S&P500 average, which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.71% |
5.2 History
The dividend of CP has a limited annual growth rate of 5.07%.
CP has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of CP decreased recently.
Dividend Growth(5Y)5.07%
Div Incr Years0
Div Non Decr Years1
5.3 Sustainability
18.40% of the earnings are spent on dividend by CP. This is a low number and sustainable payout ratio.
CP's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP18.4%
EPS Next 2Y16.41%
EPS Next 3Y15.96%
77.52
-2.74 (-3.41%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryGround Transportation
Earnings (Last)
Earnings (Next)
Inst Owners75.63%
Inst Owner Change0%
Ins Owners0.02%
Ins Owner Change0%
Market Cap72.13B
Analysts82.35
Price Target90.31 (16.5%)
Short Float %1.48%
Short Ratio4.86
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.71% |
Yearly Dividend0.55
Dividend Growth(5Y)5.07%
DP18.4%
Div Incr Years0
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.11%
Min EPS beat(2)-1.24%
Max EPS beat(2)1.02%
EPS beat(4)2
Avg EPS beat(4)-0.54%
Min EPS beat(4)-4.38%
Max EPS beat(4)2.45%
EPS beat(8)3
Avg EPS beat(8)-2.49%
EPS beat(12)4
Avg EPS beat(12)-2.3%
EPS beat(16)4
Avg EPS beat(16)-3.38%
Revenue beat(2)0
Avg Revenue beat(2)-2.65%
Min Revenue beat(2)-3.42%
Max Revenue beat(2)-1.89%
Revenue beat(4)0
Avg Revenue beat(4)-2.93%
Min Revenue beat(4)-4.24%
Max Revenue beat(4)-1.89%
Revenue beat(8)0
Avg Revenue beat(8)-3.15%
Revenue beat(12)0
Avg Revenue beat(12)-3.38%
Revenue beat(16)0
Avg Revenue beat(16)-3.81%
PT rev (1m)-0.19%
PT rev (3m)0.15%
EPS NQ rev (1m)-0.17%
EPS NQ rev (3m)-3.7%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.17%
Revenue NQ rev (1m)-0.2%
Revenue NQ rev (3m)-1.66%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.3 | ||
| Fwd PE | 18.48 | ||
| P/S | 6.7 | ||
| P/FCF | 42.16 | ||
| P/OCF | 18.35 | ||
| P/B | 2.06 | ||
| P/tB | 3.85 | ||
| EV/EBITDA | 16.71 |
EPS(TTM)3.19
EY4.12%
EPS(NY)4.19
Fwd EY5.41%
FCF(TTM)1.84
FCFY2.37%
OCF(TTM)4.22
OCFY5.45%
SpS11.57
BVpS37.67
TBVpS20.14
PEG (NY)1.38
PEG (5Y)4.6
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.38% | ||
| ROE | 7.99% | ||
| ROCE | 6.52% | ||
| ROIC | 5% | ||
| ROICexc | 5.05% | ||
| ROICexgc | 6.88% | ||
| OM | 36.85% | ||
| PM (TTM) | 26% | ||
| GM | 84.78% | ||
| FCFM | 15.89% |
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-Score6
Asset Turnover0.17
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 9.62 | ||
| Debt/EBITDA | 3.01 | ||
| Cap/Depr | 157.72% | ||
| Cap/Sales | 20.61% | ||
| Interest Coverage | 7.29 | ||
| Cash Conversion | 73.12% | ||
| Profit Quality | 61.12% | ||
| Current Ratio | 0.81 | ||
| Quick Ratio | 0.7 | ||
| Altman-Z | 2.23 |
F-Score6
WACC8.01%
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)13.73%
EPS 3Y4.29%
EPS 5Y5.28%
EPS Q2Q%13.98%
EPS Next Y17.65%
EPS Next 2Y16.41%
EPS Next 3Y15.96%
EPS Next 5Y12.59%
Revenue 1Y (TTM)7.33%
Revenue growth 3Y22.08%
Revenue growth 5Y13.3%
Sales Q2Q%7.81%
Revenue Next Year6.68%
Revenue Next 2Y6.83%
Revenue Next 3Y7.09%
Revenue Next 5Y5.86%
EBIT growth 1Y11.11%
EBIT growth 3Y18.2%
EBIT growth 5Y11.13%
EBIT Next Year45.73%
EBIT Next 3Y20.54%
EBIT Next 5Y13.83%
FCF growth 1Y-11.93%
FCF growth 3Y3.72%
FCF growth 5Y12.37%
OCF growth 1Y22.68%
OCF growth 3Y12.63%
OCF growth 5Y12%