Canadian Pacific Kansas City (CP) shares soared 9% in the last trading session to close at $73.18. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 8.1% loss over the past four weeks.The stock gained following President Donald Trump's announcement that he would pause the "reciprocal" import taxes for 90 days.This railroad is expected to post quarterly earnings of $0.75 per share in its upcoming report, which represents a year-over ...

Core Viewpoint - Canadian Pacific Kansas City Limited (CPKC) and Lanco Group/Mi-Jack have sold the Panama Canal Railway Company (PCRC) to APM Terminals, enhancing CPKC's focus on its core North American rail business [1][3]. Company Overview - CPKC is the first and only single-line transnational railway linking Canada, the United States, and Mexico, with approximately 20,000 route miles and 20,000 employees [6]. - APM Terminals operates advanced container terminals globally, with a presence in 60 locations across 33 countries and approximately 33,000 employees [4]. Financial Performance - In 2024, PCRC generated revenue of US$77 million and EBITDA of US$36 million [2]. Strategic Implications - The sale of PCRC is seen as a move to optimize assets and create shareholder value, allowing CPKC to concentrate on its North American operations [3]. - APM Terminals views PCRC as an attractive infrastructure investment that aligns with its core services of intermodal container movement [3]. Historical Context - PCRC has been a 50/50 joint venture between CPKC subsidiary Kansas City Southern and Lanco Group/Mi-Jack since its formation in 1998, operating a 47-mile railway adjacent to the Panama Canal [2][3].

Core Points - Canadian Pacific Kansas City (CPKC) has filed its notice of meeting and management proxy circular for the 2025 annual and special meeting of shareholders [1] - The annual meeting will be held virtually on April 30, 2025, at 9 a.m. MT, allowing for greater participation from shareholders [2] - Detailed instructions for participation and a Virtual AGM User Guide will be provided to shareholders [3] Company Overview - CPKC is the first and only single-line transnational railway linking Canada, the United States, and Mexico, with access to major ports across North America [4] - The railway stretches approximately 20,000 route miles and employs 20,000 railroaders, providing extensive rail service and network reach [4] - CPKC offers a suite of freight transportation services, logistics solutions, and supply chain expertise to its customers [4]

Group 1 - Recent discussions have focused on macroeconomic and geopolitical developments, including European defense spending and sticky inflation [2] - Mixed cyclical growth numbers have been observed, indicating varying economic performance across sectors [2] - There are speculations that the Trump administration may leverage short-term economic and market weaknesses for political advantage [2] Group 2 - The article emphasizes that past performance is not indicative of future results, highlighting the uncertainty in investment outcomes [3] - It clarifies that no specific investment recommendations are being made, and opinions expressed may not represent the views of the entire platform [3] - The analysts contributing to the article include both professional and individual investors, some of whom may not be licensed or certified [3]

Core Points - Canadian Pacific Kansas City (CPKC) has successfully ratified a new four-year collective agreement with the United Steelworkers (USW), covering approximately 600 clerical and intermodal employees in Canada [1][2] - This agreement marks the third collective agreement reached by CPKC employees in Canada this year, indicating a trend towards long-term labor stability and improved conditions for employees [2] - CPKC President and CEO Keith Creel emphasized the importance of collaboration with labor unions in achieving these agreements, which aim to enhance wages and benefits for thousands of employees [2] Company Overview - CPKC is the first and only single-line transnational railway connecting Canada, the United States, and Mexico, with extensive access to major ports across North America [3] - The company operates approximately 20,000 route miles and employs around 20,000 railroaders, providing comprehensive rail service and network reach to key markets [3] - CPKC is focused on growth alongside its customers, offering a range of freight transportation services, logistics solutions, and supply chain expertise [3]

Core Viewpoint - Canadian Pacific Kansas City Limited (CPKC) is issuing US$1.2 billion in notes to refinance existing debt and for general corporate purposes, with the offering expected to close on March 17, 2025 [1][2]. Group 1: Offering Details - CPKC's wholly-owned subsidiary, Canadian Pacific Railway Company, is issuing US$600 million of 4.800% Notes due 2030 and US$600 million of 5.200% Notes due 2035 [1]. - The offering is guaranteed by CPKC and is subject to customary closing conditions [1]. - The net proceeds will primarily be used for refinancing outstanding indebtedness and may be temporarily invested in short-term investment grade securities or bank deposits until utilized [2]. Group 2: Underwriters and Registration - The joint active bookrunners for the offering include Wells Fargo Securities, BofA Securities, Goldman Sachs, and Morgan Stanley, along with a syndicate of other financial institutions [3]. - The offering is made under an effective shelf registration statement previously filed with the SEC, and copies of the documents can be obtained from the SEC or the underwriters [4]. Group 3: Company Overview - CPKC is the first and only single-line transnational railway linking Canada, the United States, and Mexico, with access to major ports across North America [10]. - The company operates approximately 20,000 route miles and employs 20,000 railroaders, providing extensive rail service and logistics solutions to its customers [10].

Core Viewpoint - The Zacks Transportation - Rail industry is currently facing challenges such as inflation, high interest rates, and supply-chain disruptions, but companies like Union Pacific Corporation, Canadian Pacific Kansas City Limited, and Norfolk Southern Corporation are better positioned to navigate these issues, aided by declining fuel costs which support bottom-line growth [1][4]. Industry Description - The Zacks Transportation - Rail industry consists of railroad operators that transport various freight types across North America, focusing on logistics and supply-chain services. Revenue primarily comes from freight, with some companies also earning from rail-related services like repairs and land sales [2]. Factors Deciding the Industry's Outlook - Economic activities are improving post-pandemic, leading companies to return cash to shareholders through dividends and buybacks, indicating financial strength. For instance, CSX Corporation announced an 8.3% increase in its quarterly dividend [3]. - The decline in oil prices, which fell nearly 6% from the beginning of 2025, is beneficial for the industry as fuel costs are a significant expense for transportation companies [4]. Economic Uncertainty - Rising inflation has created market unease, with concerns that the Federal Reserve may delay rate cuts, potentially impacting economic health. This uncertainty, along with geopolitical tensions, poses risks for railroad stocks [5]. Zacks Industry Rank - The Zacks Railroad industry currently holds a Zacks Industry Rank of 148, placing it in the bottom 40% of over 250 Zacks industries, indicating bleak near-term prospects [6]. Earnings Estimates - Analysts have reduced their earnings estimates for the industry, with the consensus estimate declining by 6.2% over the past year [7]. Industry Performance - The Zacks Transportation - Rail industry has underperformed compared to the S&P 500 and the broader sector over the past year, declining by 10.5% while the S&P 500 increased by 12.5% [8][9]. Current Valuation - The industry is currently trading at a trailing 12-month price-to-book (P/B) ratio of 6.14X, compared to the S&P 500's 8.06X and the sector's 4.21X. Historically, the industry has traded between 5.72X and 10.92X over the past five years [11]. Stocks to Watch - Union Pacific Corporation (UNP) is well-positioned for growth, benefiting from stable e-commerce demand and cost-cutting efforts. The company has a strong track record of earnings surprises, beating estimates in three of the last four quarters with an average beat of 3.35% [12][13]. - Canadian Pacific Kansas City Limited (CP) has consistently paid dividends, enhancing investor confidence and showing a solid earnings surprise track record with an average of 1.76% over the past four quarters [15][18]. - Norfolk Southern Corporation (NSC) is supported by e-commerce demand and employs a Precision Scheduled Railroading plan to optimize costs and services. The company also has a commendable earnings surprise history, averaging a 2.94% beat [19][20].

Core Points - Canadian Pacific Kansas City (CPKC) has awarded Cargill Elva in Canada and Elbow Lake Co-op Grain in the United States as the grain elevators of the year for the 2023-2024 crop year [1][2] - The award recognizes facilities that efficiently move high volumes from a single loading point while maintaining a strong commitment to safety [2][3] - Cargill Elva, located in Melita, Manitoba, is a first-time winner, having loaded over 450,000 metric tonnes of grain [3][4] - Elbow Lake Co-op Grain, based in Elbow Lake, Minnesota, has won the award for three consecutive years, achieving the highest tonnage in the U.S. north network with over 543,000 metric tonnes, an increase from the previous year [4][5] Company Insights - CPKC is the first and only single-line transnational railway connecting Canada, the United States, and Mexico, with extensive access to major ports [6] - The company operates approximately 20,000 route miles and employs 20,000 railroaders, providing comprehensive rail service and network reach across North America [6] - CPKC is focused on growth alongside its customers, offering a range of freight transportation services, logistics solutions, and supply chain expertise [6]

Core Points - Canadian Pacific Kansas City (CPKC) has filed its 2024 annual report on Form 10-K with the U.S. Securities and Exchange Commission and Canadian securities regulators [1] - The report includes annual audited financial statements and management's discussion and analysis [1] - Shareholders can request a printed copy of the complete 2024 audited financial statements free of charge [1] Company Overview - CPKC is the first and only single-line transnational railway linking Canada, the United States, and Mexico [2] - The railway stretches approximately 20,000 route miles and employs 20,000 railroaders [2] - CPKC provides North American customers with unparalleled rail service and network reach to key markets across the continent [2] - The company is focused on growth, offering a suite of freight transportation services, logistics solutions, and supply chain expertise [2]

Revenue and Business Segments - In 2024, the Company generated Freight revenues totaling $14,223 million, an increase from $12,281 million in 2023[31]. - The Bulk business represented approximately 35% of total Freight revenues in 2024, with Grain accounting for 61% of bulk revenues and 21% of total Freight revenues[32]. - The Coal business contributed approximately 19% of bulk revenues and 7% of total Freight revenues in 2024[39]. - The Potash business represented approximately 12% of bulk revenues and 4% of total Freight revenues in 2024[41]. - The Merchandise business accounted for approximately 47% of total Freight revenues in 2024, with Energy, Chemicals and Plastics making up 42% of merchandise revenues[50]. - The Automotive business represented approximately 19% of merchandise revenues and 9% of total Freight revenues in 2024[59]. - The Intermodal business contributed approximately 18% of total Freight revenues in 2024, with domestic intermodal representing 55% of Intermodal revenues[61][65]. - Fuel surcharge revenues accounted for approximately 12% of the Company's Freight revenues in 2024, totaling $1,651 million, an increase of $28 million or 2% from 2023[69][70]. Operational Developments - The Company opened the CPKC Dallas Automotive Facility in Wylie, Texas, enhancing its closed-loop rail service for automotive manufacturers[60]. - The Company is actively developing new offerings such as transload facilities and new train services to remain competitive in the logistics market[72]. - First-quarter revenues are typically lower due to winter weather conditions, with operating income also affected by seasonal fluctuations[73]. Environmental and Regulatory Compliance - The Company has a consolidated 2030 locomotive GHG emissions reduction target validated by the Science Based Targets Initiative (SBTi)[99]. - The Company established a Carbon Reduction Task Force in 2022 to evaluate and implement climate action measures to reduce GHG emissions[100]. - The Company developed North America's first line-haul hydrogen-powered freight locomotive, with two in service and two in testing as of 2024[101]. - CPKCM holds a concession from the Mexican government until June 2047, with an annual concession duty of 1.25% of gross revenues[83]. - The Company is subject to extensive federal, provincial, state, and local environmental laws and regulations, which could materially affect its financial condition[85]. - The Company has implemented an Environmental Management System to reduce environmental risk and ensure compliance with applicable laws[86]. - The Company is required to maintain operational standards for its rail lines and return assets in specified condition at the end of the concession period[84]. - The Company’s U.S. operations are subject to safety regulations enforced by the Federal Railroad Administration and the Pipeline and Hazardous Materials Safety Administration[79]. - The Company’s rail operations in Canada are subject to economic regulation by the Canadian Transportation Agency, which indirectly regulates rates[75]. Workforce and Labor Relations - As of December 31, 2024, the total number of employees was 19,797, a decrease of 130 from 19,927 in 2023[104]. - The total workforce, including contractors and consultants, was 19,924, down 114 from 20,038 in 2023[104]. - The FRA-reportable personal injury incidents rate per 200,000 employee-hours decreased by 18% to 0.95 in 2024, compared to 1.16 in 2023[113]. - The FRA-reportable train accident rate per million train-miles decreased by 5% to 1.01 in 2024, down from 1.06 in 2023[113]. - Unionized employees represent nearly 73% of the workforce, with 74 active bargaining units[106]. - In Canada, there are eight bargaining units representing approximately 7,100 unionized active employees, with three agreements open for renewal[107]. - In the U.S., there are 65 active bargaining units representing about 4,200 unionized active employees, with 62 agreements recently opened for renewal[108]. - Approximately 3,200 employees in Mexico are covered by a single labor agreement, with terms subject to annual renegotiation[109]. - The Company has been recognized as one of Alberta's Top 85 Employers for six consecutive years, highlighting its commitment to attracting and retaining talent[118]. - The Company emphasizes diversity, with 33.3% of its Board of Directors being women and 58.3% identifying as members of designated groups[125]. - The Company faces human capital risks due to the availability of qualified personnel, particularly locomotive engineers, which could adversely affect operations and financial condition[138]. - Strikes or work stoppages related to collective bargaining agreements with labor unions could disrupt operations and negatively impact financial results[139]. Financial Condition and Risks - The company has $22,623 million in indebtedness as of December 31, 2024, which may reduce liquidity and limit flexibility in responding to business opportunities[179]. - The company's operations in Mexico are subject to significant economic and political risks, including potential adverse effects from currency fluctuations, inflation, and changes in government policies[157]. - The company is exposed to climate-related risks, including severe weather events that could disrupt operations and lead to substantial costs for infrastructure modifications[165]. - The company has established a GHG emissions reduction target, which may be impacted by various risks and uncertainties, including changes in carbon markets and regulatory environments[168]. - Fluctuations in the peso-dollar exchange rate could adversely affect the company's financial statements and tax obligations, potentially increasing cash tax obligations[163]. - The company has invested significantly in developing intermodal operations, which depend on the volume of Asian shipments routed through the Port of Lázaro Cárdenas[161]. - Changes in global economic conditions and international trade policies could negatively affect demand for commodities transported by the company, impacting financial results[176]. - The company faces liquidity risks due to potential instability in capital markets, which could restrict access to financing and increase costs[178]. - The company is subject to risks related to public health crises, such as pandemics, which can create economic disruption and volatility[177]. - The company’s ability to meet debt service obligations may be adversely affected by downturns in the U.S. or Mexican economies[161]. Financial Performance - Total revenues for 2024 reached CAD 14,546 million, a 15.8% increase from CAD 12,555 million in 2023[380]. - Operating income for 2024 was CAD 5,179 million, up 18.0% from CAD 4,388 million in 2023[380]. - Net income for 2024 was CAD 3,713 million, a decrease of 5.4% compared to CAD 3,923 million in 2023[381]. - The projected benefit obligation of the Company's defined benefit pension plan was CAD 10,166 million as of December 31, 2024[375]. - The fair value of the Company's fixed rate debt would increase by approximately CAD 1.7 billion with a hypothetical one percentage point decrease in interest rates[367]. - The Company reported net interest expense of CAD 801 million for 2024, compared to CAD 771 million in 2023[380]. - Comprehensive income for 2024 was CAD 7,093 million, significantly higher than CAD 3,205 million in 2023[381]. - The Company may need to raise substantial additional financing to fund working capital and capital expenditures[184]. - The Company’s ability to comply with debt covenants is subject to various risks and uncertainties[183]. - A hypothetical one percentage point change in interest rates on the Company's floating rate debt obligations is not material as of December 31, 2024[366]. - Total assets increased to CAD 87,744 million in 2024, up from CAD 79,902 million in 2023, representing a growth of 9.2%[382]. - Net income for 2024 was CAD 3,713 million, a decrease of 5.4% from CAD 3,923 million in 2023[385]. - Cash and cash equivalents rose to CAD 739 million in 2024, compared to CAD 464 million in 2023, marking a 59% increase[385]. - Total liabilities increased to CAD 38,854 million in 2024, up from CAD 37,491 million in 2023, reflecting a growth of 3.6%[382]. - Shareholders' equity reached CAD 48,890 million in 2024, an increase of 15.5% from CAD 42,411 million in 2023[382]. - The company reported net cash provided by operating activities of CAD 5,269 million in 2024, up from CAD 4,137 million in 2023, indicating a 27.4% increase[385]. - The company paid CAD 709 million in dividends in 2024, consistent with the previous year[386]. - Additions to properties amounted to CAD 2,825 million in 2024, compared to CAD 2,468 million in 2023, representing a 14.5% increase[385]. - The company recognized other comprehensive income of CAD 3,298 million in 2024, a significant increase from a loss of CAD 709 million in 2023[386]. - The company’s long-term debt stood at CAD 19,804 million in 2024, slightly up from CAD 19,351 million in 2023, reflecting a 2.3% increase[382]. Accounting and Financial Reporting - The Company uses the expected value method to estimate variable consideration, including volume rebates, which are recognized as a reduction of freight revenues[397]. - Performance obligations are generally expected to be satisfied in the following reporting period if not fully satisfied at the end of the current reporting period[398]. - The Company follows the asset and liability method for income taxes, with deferred income tax assets and liabilities determined based on enacted tax rates[399]. - A valuation allowance is recorded to reduce deferred income tax assets if it is more likely than not that they will not be realized[400]. - The Company recognizes tax benefits from uncertain tax positions only if there is a greater than 50% likelihood of being sustained upon examination[401]. - Basic earnings per share is calculated using the weighted-average number of Common Shares outstanding during the year[403]. - Equity-method investments are initially recognized at cost and adjusted for the Company's share of income or losses[404]. - Business acquisitions involve estimates and assumptions to determine the fair values of acquired assets and liabilities, which may be adjusted during the measurement period[407].