Kansas City Southern (KSU) Upgraded to Buy by Zacks Investment Research
Kansas City Southern (NYSE:KSU) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a research report issued to clients and investors on Tuesday. The brokerage presently has a $101.00 target price on the stock. Zacks Investment Research’s price target points to a potential upside of 12.41% from the stock’s current price.
According to Zacks, “Kansas City Southern, with its wide cross-country network, remains focused on growing opportunities in cross-border intermodal businesses between the U.S. and Mexico. The company has a dominant position on the U.S.-Mexico routes. Moreover, the company’s consistent efforts to expand its business, its ability to hike prices and efforts to reduce costs continue to impress. We are also impressed by the company's efforts to reward its shareholders. However, like most railroads, the company has been adversely affected by weakness in the energy segment. The Mexican peso depreciation is another headwind. However, the company's top line is expected to improve in the second half of the year.”
Other equities research analysts have also recently issued reports about the stock. Barclays PLC raised shares of Kansas City Southern from an “underweight” rating to an “equal weight” rating and increased their price objective for the company from $94.00 to $99.00 in a research note on Monday, September 12th. Oppenheimer Holdings Inc. began coverage on shares of Kansas City Southern in a research note on Wednesday, June 15th. They issued an “outperform” rating and a $87.32 price objective on the stock. Citigroup Inc. reissued a “buy” rating and issued a $108.00 price objective on shares of Kansas City Southern in a research note on Wednesday, July 6th. Bank of America Corp. reaffirmed a “buy” rating on shares of Kansas City Southern in a research note on Tuesday, July 12th. Finally, BMO Capital Markets reaffirmed a “market perform” rating and set a $94.00 price target on shares of Kansas City Southern in a research note on Thursday, July 7th. One equities research analyst has rated the stock with a sell rating, ten have issued a hold rating, eleven have issued a buy rating and one has assigned a strong buy rating to the stock. The stock currently has a consensus rating of “Buy” and an average target price of $100.82.
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Kansas City Southern (NYSE:KSU) traded up 0.14% during midday trading on Tuesday, hitting $89.98. 723,964 shares of the stock were exchanged. Kansas City Southern has a 12-month low of $62.20 and a 12-month high of $100.69. The stock has a market cap of $9.72 billion, a price-to-earnings ratio of 19.58 and a beta of 1.13. The firm has a 50 day moving average of $96.25 and a 200-day moving average of $91.95.
Kansas City Southern (NYSE:KSU) last issued its quarterly earnings data on Tuesday, July 19th. The company reported $1.22 EPS for the quarter, beating the Zacks’ consensus estimate of $1.08 by $0.14. The firm had revenue of $569 million for the quarter, compared to analysts’ expectations of $572.20 million. Kansas City Southern had a net margin of 21.13% and a return on equity of 12.00%. On average, equities analysts expect that Kansas City Southern will post $4.79 earnings per share for the current year.
The firm also recently disclosed a quarterly dividend, which will be paid on Wednesday, October 5th. Shareholders of record on Monday, September 12th will be issued a $0.33 dividend. This represents a $1.32 dividend on an annualized basis and a yield of 1.47%. The ex-dividend date of this dividend is Thursday, September 8th. Kansas City Southern’s dividend payout ratio is presently 28.82%.
In other news, insider David L. Starling sold 5,100 shares of the business’s stock in a transaction on Wednesday, July 20th. The shares were sold at an average price of $98.88, for a total transaction of $504,288.00. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at the SEC website. Also, SVP William J. Wochner sold 26,521 shares of the business’s stock in a transaction on Wednesday, July 20th. The shares were sold at an average price of $98.32, for a total transaction of $2,607,544.72. The disclosure for this sale can be found here. 0.86% of the stock is currently owned by company insiders.
Several institutional investors have recently made changes to their positions in the stock. Macquarie Group Ltd. increased its position in shares of Kansas City Southern by 10.4% in the second quarter. Macquarie Group Ltd. now owns 44,750 shares of the company’s stock valued at $4,032,000 after buying an additional 4,200 shares during the period. Kentucky Retirement Systems Insurance Trust Fund purchased a new position in shares of Kansas City Southern during the second quarter valued at about $393,000. Kentucky Retirement Systems purchased a new position in shares of Kansas City Southern during the second quarter valued at about $827,000. Nomura Holdings Inc. increased its position in shares of Kansas City Southern by 10,267.3% in the second quarter. Nomura Holdings Inc. now owns 417,699 shares of the company’s stock valued at $37,740,000 after buying an additional 413,670 shares during the period. Finally, Mason Street Advisors LLC purchased a new position in shares of Kansas City Southern during the second quarter valued at about $1,310,000. 91.37% of the stock is owned by institutional investors.
Kansas City Southern Company Profile
Kansas City Southern (KCS) is a transportation holding company with 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 controls and owns The Kansas City Southern Railway Company (KCSR), a United States Class I railroad that serves a 10-state region in the midwest and southeast regions of the United States and has the shortest north/south rail route between Kansas City, Missouri and several key ports along the Gulf of Mexico in Alabama, Louisiana, Mississippi and Texas.
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