Benchmark maintains Hold on Canadian Pacific Kansas City stock

Despite the positive outlook, Benchmark analysts have pointed out that the current stock valuation already reflects the company’s strategic plan. Canadian Pacific (NYSE:CP) Kansas City’s stock is trading at a premium with a multiple of 20.5 times the estimated earnings for 2026, compared to the peer average of 17.0 times. This premium valuation is further evidenced by the current P/E ratio of 30.78 and high revenue multiples. According to InvestingPro’s Fair Value analysis, the stock appears slightly overvalued at current levels, aligning with the analysts’ Hold rating. For a deeper understanding of CP’s valuation metrics and growth potential, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

Despite the positive outlook, Benchmark analysts have pointed out that the current stock valuation already reflects the company’s strategic plan. Canadian Pacific Kansas City’s stock is trading at a premium with a multiple of 20.5 times the estimated earnings for 2026, compared to the peer average of 17.0 times. This premium valuation is further evidenced by the current P/E ratio of 30.78 and high revenue multiples. According to InvestingPro’s Fair Value analysis, the stock appears slightly overvalued at current levels, aligning with the analysts’ Hold rating. For a deeper understanding of CP’s valuation metrics and growth potential, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

The company’s strategy includes modest growth in average headcount and the potential benefits from the expected resumption of share repurchases. Canadian Pacific Kansas City’s forecast also cautiously incorporates potential risks related to the broader economic environment and tariff uncertainties. Nevertheless, management is confident that, barring extreme market volatility, the company could reach the higher end of its guidance. This confidence is backed by CP’s focus on areas within its control, such as unique synergy opportunities and company-specific growth initiatives.

Despite the positive outlook, Benchmark analysts have pointed out that the current stock valuation already reflects the company’s strategic plan. Canadian Pacific Kansas City’s stock is trading at a premium with a multiple of 20.5 times the estimated earnings for 2026, compared to the peer average of 17.0 times. This premium valuation is further evidenced by the current P/E ratio of 30.78 and high revenue multiples. According to InvestingPro’s Fair Value analysis, the stock appears slightly overvalued at current levels, aligning with the analysts’ Hold rating. For a deeper understanding of CP’s valuation metrics and growth potential, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

In other recent news, Canadian Pacific Kansas City Limited (CPKC) reported fourth-quarter 2024 earnings that exceeded both Citi’s and Wall Street’s expectations, with an adjusted earnings per share of C$1.29 and revenue ton-miles increasing by 2.3%. The company’s reported revenue was $73 million higher than Citi’s projection. Furthermore, Citi analyst Ariel Rosa raised the price target for CPKC to $91.00, maintaining a Buy rating on the company’s shares.

Recent developments also include a tentative four-year agreement with the union Unifor, which affects various Canadian employees. In addition, the company declared a quarterly dividend of $0.19 per share, continuing a streak of dividend payments for 24 consecutive years.

Several analyst firms have updated their ratings for CPKC. Wolfe Research upgraded the company’s stock rating to Outperform following the acquisition of Kansas City Southern (NYSE:KSU). Jefferies maintained a Buy rating, emphasizing potential for share repurchases in 2025. RBC Capital, despite reducing its price target, upheld an Outperform rating. However, Stephens maintained an Equal Weight rating due to uncertainties, revising its price target for CPKC to $81. These are among the recent developments that provide valuable insights for investors.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.