Arrowstreet Capital Limited Partnership has significantly increased its holdings in Canadian Pacific Kansas City Limited (NYSE: CP) during the second quarter of 2023. The investment firm boosted its share count by an impressive 866.2%, acquiring an additional 197,574 shares. This brings Arrowstreet Capital’s total ownership to 220,383 shares, valued at approximately $17.47 million.
Several other hedge funds have also adjusted their positions in Canadian Pacific Kansas City. Notably, Vanguard Group Inc. expanded its stake by 2.9%, adding 1,080,835 shares to reach a total of 38,223,823 shares, worth around $3.04 billion. Similarly, TD Asset Management Inc. increased its holdings by 0.7% during the same quarter, now owning 21,002,374 shares valued at about $1.67 billion.
In addition, Causeway Capital Management LLC raised its stake by 11.5% in the first quarter, while Mackenzie Financial Corp. increased its position by 0.9% in the second quarter. Furthermore, JPMorgan Chase & Co. significantly boosted its holdings by 87.2%, acquiring an additional 7,454,810 shares to bring its total to 16,000,064 shares, valued at approximately $1.27 billion. Currently, approximately 72.20% of Canadian Pacific Kansas City’s stock is held by hedge funds and institutional investors.
Analysts Adjust Price Targets
Research analysts have been active in reassessing their price targets for Canadian Pacific Kansas City. Citigroup recently lowered its price objective from $90.00 to $88.00, maintaining a “buy” rating. Meanwhile, National Bankshares confirmed an “outperform” rating, emphasizing confidence in the company’s future performance. Royal Bank Of Canada also reduced its target from $129.00 to $127.00 while maintaining an “outperform” rating.
On average, analysts have set a consensus target price of $91.69 for the stock, with one analyst rating it as a Strong Buy, twelve as Buy, four as Hold, and one as Sell. These assessments reflect a general optimism about Canadian Pacific Kansas City’s market position.
Company Performance and Dividend Announcement
On October 29, 2023, Canadian Pacific Kansas City reported its quarterly earnings, revealing earnings per share of $0.80, slightly below the analysts’ expectations of $0.81. The company reported revenues of $2.62 billion for the quarter, compared to the expected $2.71 billion. The net margin stood at 28.41%, with a return on equity of 8.79%. These figures indicate a decline compared to the previous year, where the company earned $0.99 per share.
In a positive development for shareholders, Canadian Pacific Kansas City has declared a quarterly dividend of $0.228, set to be paid on January 26, 2024, to investors who are on record by December 31, 2023. This announcement marks an increase from the previous dividend of $0.17, resulting in an annualized dividend of $0.91 and a yield of 1.2%.
Canadian Pacific Kansas City operates a transcontinental freight railway network across Canada, the United States, and Mexico, transporting a variety of goods including bulk commodities and merchandise freight. As the company continues to navigate the challenges of the transportation sector, the recent investment activity and analyst ratings suggest a concerted faith in its future growth.
