Kansas City Southern
The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Kansas City Southern met expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue expanded and GAAP earnings per share dropped.
Gross margins grew, operating margins increased, net margins contracted.
Kansas City Southern tallied revenue of $577.4 million. The 17 analysts polled by S&P Capital IQ hoped for sales of $577.8 million on the same basis. GAAP reported sales were 6.0% higher than the prior-year quarter's $544.5 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.82. The 20 earnings estimates compiled by S&P Capital IQ predicted $0.85 per share. GAAP EPS of $0.82 for Q3 were 9.9% lower than the prior-year quarter's $0.91 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 39.9%, 240 basis points better than the prior-year quarter. Operating margin was 31.3%, 260 basis points better than the prior-year quarter. Net margin was 15.6%, 270 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $573.4 million. On the bottom line, the average EPS estimate is $0.88.
Next year's average estimate for revenue is $2.25 billion. The average EPS estimate is $3.29.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 432 members out of 447 rating the stock outperform, and 15 members rating it underperform. Among 100 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 99 give Kansas City Southern a green thumbs-up, and one give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Kansas City Southern is outperform, with an average price target of $80.94.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. 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.