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Market Overview

Canadian Pacific Railway's Earnings: A Preview

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Canadian Pacific Railway (NYSE:CP) unveils its next round of earnings this Wednesday, January 27. Get prepared with Benzinga's ultimate preview for Canadian Pacific Railway's Q4 earnings.

Net Income, Earnings, And Earnings Per Share

Earnings and especially earnings per share (EPS) are useful measures of a company's profitability. Total earnings, which is also referred to as net income, equals total revenue minus total expenses. EPS equals to net income divided by the number of shares outstanding.

Earnings And Revenue

Analysts covering Canadian Pacific Railway modeled for quarterly EPS of $3.94 on revenue of $1.63 billion. Canadian Pacific Railway earnings in the same period a year ago was $3.67 per share. Quarterly sales came in at $1.59 billion.

Why Analyst Estimates And Earnings Surprises Are Important

Analysts who cover this company will publish forward-looking estimates of its revenue and EPS each quarter. Averaging together every EPS and revenue prediction that each analyst makes about a company in a quarter yields the "consensus estimates." A company posting earnings or revenue above or below the consensus estimate is known as an "earnings surprise" and may move the stock by a considerable margin.

If the company were to match the consensus estimate when it reports Wednesday, EPS would be up 7.36%. Sales would be have grown 2.32% from the same quarter last year. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020
EPS Estimate 3.23 2.77 4.03 3.52
EPS Actual 3.09 2.94 3.30 3.67
Revenue Estimate 1.41 B 1.29 B 1.96 B 1.52 B
Revenue Actual 1.40 B 1.29 B 1.52 B 1.59 B

Stock Performance

Over the last 52-week period, shares are up 30.99%. Given that these returns are generally positive, long-term shareholders can relax going into this earnings release. Long-term shareholders are already enjoying 12-month gains prior to the announcement.

Do not be surprised to see the stock move on comments made during its conference call. Canadian Pacific Railway is scheduled to hold the call at 16:30:00 ET and can be accessed here.

 

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Posted-In: BZI-EPEarnings