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.
If you're interested in transportation companies like Kansas City Southern, then you should check out our special report that features 3 companies who depend on, and invest in, that industry. Learn the basic financial habits of millionaires next door and get these 3 focused stock ideas in our free report, "3 Stocks That Will Help You Retire Rich." Click here for instant access to this free report.
- Add Kansas City Southern to My Watchlist.
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 position in any of the stocks mentioned. 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.