Kansas City Southern Sees Unusually Large Options Volume (KSU)
Kansas City Southern (NYSE:KSU) was the recipient of some unusual options trading activity on Monday. Traders bought 16,095 call options on the company. This represents an increase of approximately 1,193% compared to the typical daily volume of 1,245 call options.
Kansas City Southern (NYSE KSU) opened at 107.49 on Thursday. The stock has a market capitalization of $11.33 billion, a PE ratio of 21.63 and a beta of 0.80. Kansas City Southern has a 1-year low of $79.05 and a 1-year high of $109.13. The company’s 50-day moving average is $103.89 and its 200 day moving average is $93.76.
Kansas City Southern (NYSE:KSU) last announced its quarterly earnings data on Friday, July 21st. The transportation company reported $1.33 earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of $1.26 by $0.07. Kansas City Southern had a net margin of 21.52% and a return on equity of 11.40%. The firm had revenue of $656.40 million during the quarter, compared to analyst estimates of $627.81 million. During the same quarter in the prior year, the firm posted $1.22 earnings per share. Kansas City Southern’s quarterly revenue was up 15.5% on a year-over-year basis. Equities analysts predict that Kansas City Southern will post $5.21 earnings per share for the current year.
Kansas City Southern announced that its Board of Directors has initiated a share buyback plan on Tuesday, August 15th that permits the company to repurchase $800.00 million in shares. This repurchase authorization permits the transportation company to buy up to 7.1% of its shares through open market purchases. Shares repurchase plans are usually a sign that the company’s management believes its stock is undervalued.
The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, October 4th. Investors of record on Monday, September 11th will be issued a $0.36 dividend. The ex-dividend date is Friday, September 8th. This represents a $1.44 dividend on an annualized basis and a dividend yield of 1.34%. This is a positive change from Kansas City Southern’s previous quarterly dividend of $0.33. Kansas City Southern’s dividend payout ratio is currently 26.51%.
Several large investors have recently made changes to their positions in KSU. BlackRock Inc. raised its stake in shares of Kansas City Southern by 4,542.5% in the first quarter. BlackRock Inc. now owns 10,407,991 shares of the transportation company’s stock worth $892,591,000 after buying an additional 10,183,801 shares in the last quarter. Massachusetts Financial Services Co. MA raised its position in shares of Kansas City Southern by 588.6% in the first 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 period. Pioneer Investment Management Inc. raised its position in shares of Kansas City Southern by 103.8% in the first 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 period. Sustainable Growth Advisers LP raised its position in shares of Kansas City Southern by 49.4% in the first 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 period. Finally, MARSHALL WACE ASIA Ltd bought a new position in shares of Kansas City Southern during the first quarter valued at $52,373,000. 85.05% of the stock is owned by hedge funds and other institutional investors.
A number of equities research analysts have recently commented on the stock. Cowen and Company reiterated a “market perform” rating and set a $104.00 price target (up previously from $95.00) on shares of Kansas City Southern in a report on Monday, July 24th. BMO Capital Markets restated a “hold” rating and set a $92.00 price objective on shares of Kansas City Southern in a research report on Wednesday, May 24th. Aegis increased their price objective on shares of Kansas City Southern from $110.00 to $115.00 and gave the company a “buy” rating in a research report on Monday, June 19th. Stifel Nicolaus lowered their price objective on shares of Kansas City Southern from $101.00 to $96.00 and set a “buy” rating on the stock in a research report on Wednesday, April 26th. Finally, UBS AG restated a “positive” rating and set a $117.00 price objective (up previously from $103.00) on shares of Kansas City Southern in a research report on Monday, July 24th. Eleven research analysts have rated the stock with a hold rating and nine have issued a buy rating to the company’s stock. The company presently has an average rating of “Hold” and a consensus price target of $102.67.
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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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