Canadian Pacific Railway Limited [CP] stock Downgrade by BofA Securities analyst, price target now $81

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Canadian Pacific Railway Limited [NYSE: CP] gained 0.17% or 0.12 points to close at $72.74 with a heavy trading volume of 4145326 shares. The company report on April 27, 2022 that CP reports first-quarter results; building momentum in Q2.

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Canadian Pacific Railway Limited (TSX: CP) (NYSE: CP) (the “Company”) today announced first-quarter operating results.

In light of the financial complexity of acquiring Kansas City Southern (“KCS”) into voting trust on Dec. 14, 2021, CP is reporting additional financial metrics, including Core adjusted income1 and Core adjusted diluted earnings per share1 (“EPS”). These metrics have been added to provide more transparency by isolating for the impact of KCS purchase accounting. KCS purchase accounting represents the amortization of the difference in value between the consideration paid to acquire KCS and the underlying carrying value of the net assets of KCS immediately prior to the acquisition by the Company.

It opened the trading session at $72.67, the shares rose to $73.44 and dropped to $71.07, the range by which the price of stock traded the whole day. The daily chart for CP points out that the company has recorded -3.67% loss over the past six months. However, it is still -13.0% lower than its most recent low trading price.

If we look at the average trading volume of 3.24M shares, CP reached to a volume of 4145326 in the most recent trading day, which is why market watchdogs consider the stock to be active.

Here is what top equities market gurus are saying about Canadian Pacific Railway Limited [CP]:

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for CP shares is $83.13 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on CP stock is a recommendation set at 2.30. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

BofA Securities have made an estimate for Canadian Pacific Railway Limited shares, keeping their opinion on the stock as Neutral, with their previous recommendation back on April 08, 2022. While these analysts kept the previous recommendation, JP Morgan raised their target price to Overweight. The new note on the price target was released on March 10, 2022, representing the official price target for Canadian Pacific Railway Limited stock. On January 03, 2022, analysts increased their price target for CP shares from 73 to 87.

The Average True Range (ATR) for Canadian Pacific Railway Limited is set at 1.85, with the Price to Sales ratio for CP stock in the period of the last 12 months amounting to 11.07. The Price to Book ratio for the last quarter was 1.55, with the Price to Cash per share for the same quarter was set at 0.06. Price to Free Cash Flow for CP in the course of the last twelve months was 53.67 with Quick ratio for the last quarter at 0.40.

Trading performance analysis for CP stock

Canadian Pacific Railway Limited [CP] fell into the red zone at the end of the last week, falling into a negative trend and dropping by -7.08. With this latest performance, CP shares dropped by -12.19% in over the last four-week period, additionally sinking by -3.67% over the last 6 months – not to mention a drop of -2.90% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for CP stock in for the last two-week period is set at 34.82, with the RSI for the last a single of trading hit 28.36, and the three-weeks RSI is set at 39.72 for Canadian Pacific Railway Limited [CP]. The present Moving Average for the last 50 days of trading for this stock 76.53, while it was recorded at 74.46 for the last single week of trading, and 73.34 for the last 200 days.

Canadian Pacific Railway Limited [CP]: A deeper dive into fundamental analysis

Operating Margin for any stock indicates how profitable investing would be, and Canadian Pacific Railway Limited [CP] shares currently have an operating margin of +41.28 and a Gross Margin at +42.79. Canadian Pacific Railway Limited’s Net Margin is presently recorded at +35.67.

Return on Equity for this stock inclined to 13.86, with Return on Assets sitting at 6.19.

Canadian Pacific Railway Limited’s liquidity data is similarly interesting compelling, with a Quick Ratio of 0.40 and a Current Ratio set at 0.40.

Canadian Pacific Railway Limited [CP]: An earnings per share (EPS) analysis

The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for CP. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for Canadian Pacific Railway Limited go to 9.20%.

An analysis of insider ownership at Canadian Pacific Railway Limited [CP]

There are presently around $48,749 million, or 69.50% of CP stock, in the hands of institutional investors. The top three institutional holders of CP stocks are: TCI FUND MANAGEMENT LTD with ownership of 55,860,385, which is approximately 0% of the company’s market cap and around 0.02% of the total institutional ownership; ROYAL BANK OF CANADA, holding 50,754,243 shares of the stock with an approximate value of $3.69 billion in CP stocks shares; and MASSACHUSETTS FINANCIAL SERVICES CO /MA/, currently with $2.44 billion in CP stock with ownership of nearly 21.534% of the company’s market capitalization.

Positions in Canadian Pacific Railway Limited stocks held by institutional investors increased at the end of April and at the time of the April reporting period, where 431 institutional holders increased their position in Canadian Pacific Railway Limited [NYSE:CP] by around 81,911,671 shares. Additionally, 540 investors decreased positions by around 148,950,370 shares, while 141 investors held positions by with 440,420,390 shares. The mentioned changes placed institutional holdings at 671,282,431 shares, according to the latest SEC report filing. CP stock had 129 new institutional investments in for a total of 14,971,709 shares, while 211 institutional investors sold positions of 41,634,367 shares during the same period.