Canadian Pacific Kansas City CP reported unimpressive third-quarter 2025 results, wherein both earnings and revenues missed the Zacks Consensus Estimate.
The quarterly earnings (excluding 7 cents from non-recurring items) of 80 cents per share missed the Zacks Consensus Estimate by a penny. The bottom line improved 9.5% on a year-over-year basis. Operating revenues of $2.65 billion lagged the Zacks Consensus Estimate of $2.67 billion. However, the top line improved 2.2% on a year-over-year basis.
In the reported quarter, total Freight revenues per revenue ton miles decreased 1% year over year. Total Freight revenues per carload declined marginally year over year.
On a reported basis, operating income increased 11%. Total operating expenses fell 1% year over year. The reported operating ratio (operating expenses as a percentage of revenues) fell 260 basis points to 63.5% from the year-ago quarter.
Canadian Pacific Kansas City Limited price-consensus-eps-surprise-chart | Canadian Pacific Kansas City Limited Quote
Freight revenues, which accounted for 98% of the top line, increased 4% year over year. CP’s Freight segment contains Grain (up 4%), Coal (up 3%), Potash (up 15%), Fertilizers and Sulphur (up 11%), Metals, minerals and consumer products (up 2%), Automotive (up 2%) and Intermodal (up 7%). Meanwhile, Energy, chemicals and plastics, and Forest products fell 2% and 3%, respectively.
Other revenues decreased 18% year over year in the third quarter of 2025.
CP exited the third quarter with cash and cash equivalents of C$411 million compared with C$799 million at the end of the prior quarter. Long-term debt amounted to C$21.59 billion compared with C$21.22 billion at the end of the prior quarter.
Despite the ongoing tariff and trade policy uncertainty, Canadian Pacific expects 2025 core adjusted earnings per share to grow in the 10%-14% range from the 2024 actuals to C$4.25 per share.
The company continues to expect 2025 RTMs to increase in the mid-single digits from the 2024 actuals.
Management expects capital expenditures to be C$2.9 billion for the full year. The core adjusted effective tax rate for 2025 is expected to be 24.5%.
Currently, Canadian Pacific carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Delta Air Lines DAL reported third-quarter 2025 earnings (excluding 46 cents from non-recurring items) of $1.71 per share, which beat the Zacks Consensus Estimate of $1.52. Earnings increased 14% on a year-over-year basis due to low fuel costs.
