The Successful Investor Hotline – Friday, April 20, 2012

Article Excerpt

CANADIAN PACIFIC RAILWAY LTD., $76.45, Toronto symbol CP, reported higher-than-expected earnings this week. In the three months ended March 31, 2012, the company’s earnings soared 317.6%, to $142.0 million from $34.0 million a year earlier. Earnings per share rose 310.0%, to $0.82 from $0.20, on more shares outstanding. That beat the consensus estimate of $0.75 a share. Severe winter weather and avalanches in B.C. delayed the company’s trains and depressed the year-earlier results. This was the main reason for the earnings jump. Revenue rose 18.3%, to $1.4 billion from $1.2 billion. The company saw revenue gains from shipping automotive products (up 31.3%), coal (up 29.2%), consumer and industrial products (up 29.0%), grain (up 24.1%), forest products (up 11.1%) and intermodal (containers that can be shipped by rail, ship or truck; up 7.7%). However, revenue from shipping fertilizer fell 2.3%. Thanks to the better weather, the company’s operating ratio improved in the latest quarter to 80.1% from 90.6%. (Operating ratio is calculated by dividing a..