The Successful Investor Hotline – Friday, April 25, 2014

Article Excerpt

CANADIAN PACIFIC RAILWAY LTD., $171.19, Toronto symbol CP, reported better-than-expected earnings this week, despite harsh winter weather that cut shipping volumes and slowed deliveries. In the three months ended March 31, 2014, CP’s earnings rose 17.1%, to $254 million from $217 million a year earlier. Per-share earnings increased at a slower pace of 16.1%, to $1.44 from $1.24, on more shares outstanding. That beat the consensus estimate of $1.41. Revenue rose 0.9%, to $1.51 billion from $1.50 billion. That’s mainly due to higher revenue from shipping consumer and industrial products (up 10.8%) and grain (up 4.1%). These gains offset declines in major areas like fertilizers (down 11.8%), automotive products (down 9.3%), forest products (down 9.4%) and coal (down 0.7%). CP continues to benefit from its efficiency improvements, mainly replacing locomotives, improving tracks and adding software that optimizes train loads and speeds. In the latest quarter, its operating ratio improved to 72.0% from 75.8% a year earlier. (Operating ratio is calculated by dividing a..