# Canadian Pacific Kansas City (CP) — Financial Analysis

**Exchange:** NYSE  
**Coverage as of:** 2026-Q2  
**Updated:** 2026-05-29  
**Tier:** Free primer (step 2 of 19)  
**Sibling pages:** /stocks/CP/thesis · /stocks/CP/memo

## Financial Snapshot

---
source: coverage-next-full
ticker: CP
step: "04"
title: Financial Snapshot — 3-Year P&L Summary
created: 2026-05-29
---

### Step 04 — Financial Snapshot

*All figures in Canadian Dollars (CAD) unless noted. IFRS reporting standard. 2021-2022 are CP standalone; 2023-2024 are CPKC (including KCS from April 2023 and full year, respectively).*

#### Three-Year Income Statement Summary

| Metric (CAD$M) | FY2022 | FY2023 | FY2024 |
|----------------|--------|--------|--------|
| **Revenue** | 9,374 | 13,188 | 14,054 |
| Operating Expenses | (5,844) | (8,788) | (9,264) |
| **Operating Income (EBIT)** | 3,530 | 4,400 | 4,790 |
| Interest Expense (net) | (486) | (1,010) | (1,140) |
| Other Income / (Expense) | (85) | (245) | (120) |
| **Pre-Tax Income** | 2,959 | 3,145 | 3,530 |
| Income Tax Expense | (708) | (735) | (847) |
| **Net Income** | 2,251 | 2,410 | 2,683 |
| Minority Interest | — | (15) | (25) |
| **Net Income Attributable to CPKC** | 2,251 | 2,395 | 2,658 |

#### Operating Ratio (OR)

| Year | Operating Ratio | Notes |
|------|----------------|-------|
| FY2022 (CP standalone) | 62.3% | Pre-KCS; CP at peak standalone efficiency |
| FY2023 (CPKC, KCS 9 months) | 66.7% | Merger integration costs, KCS legacy OR dilutive |
| FY2024 (CPKC full year) | 65.9% | Gradual improvement; integration ongoing |
| Target (management long-term) | <60% | 5-7 year runway to get there |

*KCS's standalone OR was ~65-68% at time of acquisition vs. CP's ~58-60%. The consolidated OR will improve as PSR is implemented across the former KCS network and synergies are realized.*

#### Gross Profit Analysis

*CPKC (like all railroads) does not report "gross profit" in the traditional sense. The railroad cost stack is:*

| Expense Category | FY2024 (est., CAD$M) | % of Revenue |
|-----------------|---------------------|-------------|
| Compensation & Benefits | ~3,200 | ~22.8% |
| Fuel | ~1,550 | ~11.0% |
| Materials | ~550 | ~3.9% |
| Equipment Rents | ~420 | ~3.0% |
| Depreciation & Amortization | ~1,400 | ~10.0% |
| Purchased Services & Other | ~2,145 | ~15.3% |
| **Total Operating Expenses** | **~9,265** | **~65.9%** |

#### EBITDA Analysis

| Metric (CAD$M) | FY2022 | FY2023 | FY2024 |
|----------------|--------|--------|--------|
| Operating Income (EBIT) | 3,530 | 4,400 | 4,790 |
| D&A | ~1,050 | ~1,300 | ~1,400 |
| **EBITDA** | ~4,580 | ~5,700 | ~6,190 |
| EBITDA Margin | ~48.9% | ~43.2% | ~44.1% |

*EBITDA margin compression in 2023 reflects KCS integration; 2024 shows modest recovery. Long-term EBITDA margins should expand toward 48-52% as OR improves.*

#### Earnings Per Share

| Metric (CAD$) | FY2022 | FY2023 | FY2024 |
|----------------|--------|--------|--------|
| Diluted EPS (reported) | ~2.90 | ~2.63 | ~2.92 |
| Diluted EPS (adjusted) | ~3.20 | ~3.45 | ~3.90 |
| Diluted Shares (millions) | ~775 | ~910 | ~910 |

*Reported EPS in 2023 was impressed by KCS integration costs (transaction fees, restructuring) and purchase price accounting (PPA) amortization. Adjusted EPS strips these out. Share count jumped in 2023 as CP issued ~135 million shares as KCS merger consideration.*

*Note on USD conversion: NYSE-listed CP shares reflect CAD values converted at spot. At ~0.73 CAD/USD, FY2024 adjusted EPS of ~CAD$3.90 equates to ~USD$2.85.*

#### Revenue Growth Analysis

| Period | Revenue Growth | Key Driver |
|--------|---------------|------------|
| 2021→2022 | +18.3% | Post-COVID volume recovery + fuel surcharge inflation + pricing |
| 2022→2023 | +40.7% | KCS merger (~9 months contribution): ~+CAD$3.8B |
| 2023→2024 | +6.6% | Full-year KCS + organic volume + pricing; FX headwind from USD weakness vs. CAD |
| 2024→2025E (analyst est.) | +8-10% | Synergy ramp + Mexico growth + pricing |
| 2025→2026E | +9-12% | Growing Mexico volumes, OR improvement, pricing |

#### Capital Expenditures

| Year | Capex (CAD$M) | % of Revenue | Notes |
|------|--------------|-------------|-------|
| FY2022 | ~1,900 | ~20.3% | Pre-merger CP; heavy track investment |
| FY2023 | ~2,800 | ~21.2% | Post-merger; KCS network integration; Mexico track upgrades |
| FY2024 | ~3,000 | ~21.3% | Elevated; PSR implementation on KCS network; Mexico capacity expansion |
| FY2025E | ~3,100-3,400 | ~21-22% | Elevated investment cycle |
| Long-term target | ~17-18% of revenue | — | As network investment normalizes |

*CPKC's capex as % of revenue is notably higher than US peers (UP/CSX typically 15-17%) due to: (1) Mexico network requires significant capital to bring to CPKC quality standards, (2) Canadian infrastructure investment obligations, (3) PSR-driven locomotive/car fleet investment.*

#### Free Cash Flow

| Metric (CAD$M) | FY2022 | FY2023 | FY2024 |
|----------------|--------|--------|--------|
| Operating Cash Flow | ~2,800 | ~3,800 | ~4,200 |
| Capital Expenditures | ~(1,900) | ~(2,800) | ~(3,000) |
| **Free Cash Flow** | ~900 | ~1,000 | ~1,200 |
| FCF Yield (on mkt cap) | ~1.0% | ~1.1% | ~1.3% |

*FCF is relatively modest given the heavy capex cycle. This is a feature of the integration period — as capex normalizes to ~17% of revenue and EBITDA grows, FCF should roughly double over 5 years.*

#### Key Profitability Metrics Summary

| Metric | FY2022 | FY2023 | FY2024 |
|--------|--------|--------|--------|
| Revenue (CAD$M) | 9,374 | 13,188 | 14,054 |
| EBIT Margin | 37.7% | 33.4% | 34.1% |
| EBITDA Margin | ~48.9% | ~43.2% | ~44.1% |
| Net Income Margin | 24.0% | 18.2% | 18.9% |
| Operating Ratio | 62.3% | 66.7% | 65.9% |
| Adjusted EPS (CAD$) | ~3.20 | ~3.45 | ~3.90 |
| FCF (CAD$M) | ~900 | ~1,000 | ~1,200 |

#### Forward Estimates (Analyst Consensus, as of early 2025)

| Metric | FY2025E | FY2026E | FY2027E |
|--------|---------|---------|---------|
| Revenue (CAD$M) | ~15,200-15,800 | ~16,500-17,500 | ~18,500-20,000 |
| EBITDA (CAD$M) | ~6,800-7,200 | ~7,600-8,200 | ~8,800-10,000 |
| Adj. EPS (CAD$) | ~4.30-4.60 | ~5.20-5.80 | ~6.50-7.50 |
| Operating Ratio | ~64-65% | ~62-63% | ~60-61% |

*Wide ranges reflect genuine uncertainty about Mexico ramp rate, FX, and STB conditions.*

## Deeper Financial Analysis

The fundamental tier ($1.00) adds 8 dimensions not included here:

- Revenue Breakdown — segment revenue, geographic mix, product-line margins
- Financial Trends — QoQ momentum, leading indicators, inflection points
- Balance Sheet — debt structure, dilution risk, working capital dynamics
- Capital Allocation — ROIC, buyback cadence, reinvestment efficiency
- Earnings Analysis — beats/misses, guidance vs actuals, transcript highlights
- Competitive Positioning — market share, pricing power, peer benchmarks
- Industry Context — TAM, sector tailwinds/headwinds, regulatory backdrop

**API endpoint:** GET /api/v1/research/CP/fundamental

## Navigation

- Overview: /stocks/CP
- Financials (this page): /stocks/CP/financials
- Thesis: /stocks/CP/thesis
- Investment Memo: /stocks/CP/memo
- Coverage universe: /stocks