Kansas City Southern (NYSE: KSU) beat estimates by $0.01 last quarter and investors are hoping it can beat them again. The company will unveil its latest earnings on Friday, Oct. 21. Kansas City Southern is engaged in domestic and international rail operations in North America that are focused on the growing north/south freight corridor connecting commercial and industrial markets in the central U.S.

What analysts say:

  • Buy, sell, or hold?: Analysts strongly back Kansas City Southern, with 11 of 15 rating it a buy and the remainder rating it a hold. Analysts like Kansas City Southern better than competitor Canadian Pacific Railway overall. Analysts still rate the stock a moderate buy, but they are a bit more wary about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $537.8 million in revenue this quarter. That would represent a rise of 22.7% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.75 per share. Estimates range from $0.70 to $0.79.

What our community says:
CAPS All-Stars are solidly behind the stock with 97.1% granting it an "outperform" rating. The community at large concurs with the All-Stars with 96.9% awarding it a rating of "outperform." Fools have embraced Kansas City Southern and haven't been shy with their opinions lately, logging 156 posts in the past 30 days. Even with a robust four out of five stars, Kansas City Southern's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Kansas City Southern's profit has risen year over year by an average of 96.5% over the past five quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q2

Q1

Q4

Q3

Gross Margin

56.4%

56.1%

53.8%

59.0%

Operating Margin

28.3%

26.2%

28.2%

26.5%

Net Margin

13.2%

13.1%

11.4%

12.1%

One final thing: If you want to keep tabs on Kansas City Southern movements -- and for more analysis on the company -- make sure you add it to your Watchlist.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.