Kansas City Southern
The 10-second takeaway
For the quarter ended June 30 (Q2), Kansas City Southern met expectations on revenues and beat slightly on earnings per share.
Compared to the prior-year quarter, revenue increased. Non-GAAP earnings per share expanded. GAAP earnings per share shrank significantly.
Gross margins grew, operating margins increased, net margins dropped.
Kansas City Southern booked revenue of $579.3 million. The 14 analysts polled by S&P Capital IQ hoped for revenue of $577.0 million on the same basis. GAAP reported sales were 6.2% higher than the prior-year quarter's $545.3 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 $0.96. The 23 earnings estimates compiled by S&P Capital IQ predicted $0.95 per share. Non-GAAP EPS of $0.96 for Q2 were 13% higher than the prior-year quarter's $0.85 per share. GAAP EPS of $0.14 for Q2 were 87% lower than the prior-year quarter's $1.09 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 40.4%, 200 basis points better than the prior-year quarter. Operating margin was 31.0%, 150 basis points better than the prior-year quarter. Net margin was 2.7%, much worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $626.5 million. On the bottom line, the average EPS estimate is $1.12.
Next year's average estimate for revenue is $2.39 billion. The average EPS estimate is $4.10.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 451 members out of 468 rating the stock outperform, and 17 members rating it underperform. Among 118 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 117 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 hold, with an average price target of $111.11.
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