Kansas City Southern (NYSE:KSU) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a report released on Monday.
According to Zacks, “Kansas City Southern's shares comfortably outperformed the industry it belongs to in the last three months. The improving scenario with respect to coal is aiding Kansas City Southern significantly. We are also bullish on the company's efforts to reward shareholders dividend payments and buybacks. In line with this objective, the company recently hiked its quarterly dividend in excess of 9%. Moreover, its board cleared a new share repurchase program worth $800 million. Sluggish intermodal revenues and high fuel costs, however, remain concerns. Moreover, high fuel costs might limit bottom line growth going forward.”
A number of other equities analysts have also recently issued reports on the company. Credit Suisse Group reissued a “neutral” rating and issued a $90.00 target price (up from $87.00) on shares of Kansas City Southern in a report on Sunday, May 28th. BidaskClub cut Kansas City Southern from a “strong-buy” rating to a “buy” rating in a report on Thursday, June 22nd. Aegis increased their target price on Kansas City Southern from $110.00 to $115.00 and gave the stock a “buy” rating in a report on Monday, June 19th. BMO Capital Markets reissued a “hold” rating and issued a $92.00 target price on shares of Kansas City Southern in a report on Wednesday, May 24th. Finally, UBS AG reissued a “positive” rating and issued a $117.00 target price (up from $103.00) on shares of Kansas City Southern in a report on Monday, July 24th. Eleven research analysts have rated the stock with a hold rating, eight have assigned a buy rating and one has issued a strong buy rating to the company’s stock. The stock has a consensus rating of “Buy” and a consensus price target of $105.53.
Kansas City Southern (NYSE KSU) opened at 106.12 on Monday. The company’s 50-day moving average price is $104.11 and its 200-day moving average price is $96.09. The firm has a market cap of $11.19 billion, a price-to-earnings ratio of 21.36 and a beta of 0.79. Kansas City Southern has a 52-week low of $79.05 and a 52-week high of $109.13.
Kansas City Southern (NYSE:KSU) last issued its earnings results on Friday, July 21st. The transportation company reported $1.33 earnings per share (EPS) for the quarter, topping the Zacks’ consensus estimate of $1.26 by $0.07. Kansas City Southern had a return on equity of 11.40% and a net margin of 21.52%. The business had revenue of $656.40 million during the quarter, compared to analysts’ expectations of $627.81 million. During the same period in the prior year, the firm posted $1.22 EPS. Kansas City Southern’s quarterly revenue was up 15.5% compared to the same quarter last year. Analysts predict that Kansas City Southern will post $5.20 EPS for the current year.
Kansas City Southern declared that its Board of Directors has approved a share buyback plan on Tuesday, August 15th that permits the company to repurchase $800.00 million in outstanding shares. This repurchase authorization permits the transportation company to purchase up to 7.1% of its stock through open market purchases. Stock repurchase plans are generally a sign that the company’s board believes its shares are undervalued.
In other news, Director Henry J. Maier acquired 3,000 shares of the firm’s stock in a transaction on Thursday, August 17th. The shares were purchased at an average cost of $106.19 per share, for a total transaction of $318,570.00. Following the transaction, the director now owns 4,159 shares of the company’s stock, valued at $441,644.21. The purchase was disclosed in a filing with the SEC, which can be accessed through this link. Also, Director Antonio O. Garza sold 4,018 shares of the stock in a transaction on Tuesday, August 22nd. The shares were sold at an average price of $107.94, for a total value of $433,702.92. Following the completion of the transaction, the director now owns 4,920 shares in the company, valued at $531,064.80. The disclosure for this sale can be found here. Insiders sold a total of 14,469 shares of company stock worth $1,522,510 over the last quarter. Corporate insiders own 0.95% of the company’s stock.
A number of institutional investors and hedge funds have recently made changes to their positions in KSU. BlackRock Inc. boosted its position in Kansas City Southern by 4,542.5% in the 1st quarter. BlackRock Inc. now owns 10,407,991 shares of the transportation company’s stock valued at $892,591,000 after buying an additional 10,183,801 shares during the last quarter. Massachusetts Financial Services Co. MA boosted its position in Kansas City Southern by 588.6% in the 1st quarter. Massachusetts Financial Services Co. MA now owns 4,313,685 shares of the transportation company’s stock valued at $369,943,000 after buying an additional 3,687,248 shares during the last quarter. Pioneer Investment Management Inc. boosted its position in Kansas City Southern by 103.8% in the 1st quarter. Pioneer Investment Management Inc. now owns 2,133,685 shares of the transportation company’s stock valued at $182,985,000 after buying an additional 1,086,853 shares during the last quarter. Sustainable Growth Advisers LP boosted its position in Kansas City Southern by 49.4% in the 1st quarter. Sustainable Growth Advisers LP now owns 2,088,516 shares of the transportation company’s stock valued at $179,111,000 after buying an additional 690,470 shares during the last quarter. Finally, MARSHALL WACE ASIA Ltd bought a new position in Kansas City Southern in the 1st quarter valued at $52,373,000. Hedge funds and other institutional investors own 84.54% of the company’s stock.
About Kansas City Southern
Kansas City Southern (KCS) is a holding company. The Company has domestic and international rail operations in North America that are focused on the north/south freight corridor connecting commercial and industrial markets in the central United States with industrial cities in Mexico. The Company’s subsidiaries include The Kansas City Southern Railway Company (KCSR) and Kansas City Southern de Mexico, SA de C.V.
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