Canadian Pacific Kansas City: Staying the Course

研报英文原文证据摘录

Canadian Pacific Kansas City: Staying the Course

ide support Q3 1.10 1.35 1.53

across several end markets including Autos while supply chain investments Q4 1.33 1.60 1.80

FY 4.61 5.25 6.10

can also create opportunities in areas such as export grain to Mexico. It is

difficult to differentiate between organic growth and merger synergies Style Exposure

although the benefits from an extended length of haul are still emerging based

on significant gains in Forest Product exports to the U.S. despite hostile

commercial conditions. Fundamental market support should also help

Intermodal activity with Domestic growth supported by SMX and better truck-

to-rail conversion conditions, while International is returning to growth on

easier comps and port-focused initiatives.

• Ready to mount a vocal opposition to the UP/NS merger. CPKC reiterated

that they are strongly opposed to further rail consolidation but they would not

sit still if the merger does proceed. Management recognized that UP’s

supplemental concessions are a step in the right direction, but argued that they

are temporary and not broad enough to satisfy the STB’s competition test. The

recent deal between granting CN access to Mexico was largely dismissed as a

multi-line move controlled by UP and funneled through a constrained Eagle

Pass gateway. CPKC reiterated that its own Mexico value proposition is

difficult to replicate, citing land-bridge momentum from ~$100mm in 2023 to

an expected ~$600mm run-rate by YE26 with a path to $1B longer term.

• Stronger topline largely offset by higher opex. CPKC’s adjusted operating

income came in +$0.01 above JPMe and +$0.03 above consensus as ECP

growth from higher crude and MMC growth from improving steel volume and

aggregates drove the topline strength vs JPMe that was +$0.08.