Kansas City Southern (KSU) Top Q2 Earnings & Sales Estimates

Kansas CitySouthern (NYSE:KSU) second-quarter 2017 earnings of $1.33 beat the Zacks Consensus Estimate of $1.26 per share. The bottom line expanded 9.02% on a year-over-year basis. Results were aided by higher revenues.

The company reported revenues of $656.4 million, which surpassed the Zacks Consensus Estimate of $620.6 million. Revenues improved 15.46% on a year-over-year basis. The results were aided by a 6% rise in overall carload volumes.

In the quarter, operating income increased 9% to $239 million. Kansas City Southern reported operating ratio of 63.5%, reflecting a deterioration of 220 basis points on a year-over-year basis.

Kansas City Southern Price, Consensus and EPS Surprise

Kansas City Southern Price, Consensus and EPS Surprise | Kansas City Southern Quote

Segment Results

The Chemical & Petroleum segment generated revenues of $138.8 million, up 13% year over year. Volumes improved 6% year over year. Revenues per carload also improved 7% from the prior-year quarter.

The Industrial & Consumer Products segment generated revenues of $148.6 million, up 9% year over year. While business volumes increased 4%, revenues per carload climbed 5% year over year.

The Agriculture & Minerals segment revenues totaled $123.4 million, up 7% year over year. While business volumes declined 3%, revenues per carload were up 10%, both on a year-over-year basis.

The Energy segment generated revenues of $70.5 million, up 90% year over year. Impressive performance of Utility Coal boosted the segment’s results. Business volumes improved 41% year over year, while revenues per carload rose 35%.

Intermodal revenues were $90.6 million, down 1% year over year. While business volumes slipped 1%, revenues per carload improved 1% in the reported quarter.

The Automotive segment accounted for $57.5 million of the total revenue, up 29% year over year. While business volumes improved 23%, revenues per carload increased 4%.

Other revenues totaled $27 million, up 24% year over year.

Upcoming Releases

Investors interested in the railroad space also keenly await second-quarter earnings reports from key players like Canadian National Railway Company (NYSE:CNI) , Norfolk Southern Corp. (NYSE:NSC) and Genesee & Wyoming Inc. (NYSE:GWR) in the coming days. While Canadian National and Norfolk Southern are scheduled to report on Jul 25 and Jul 26, respectively, Genesee & Wyoming will report on Aug 1.

Zacks Rank

Currently, Kansas City Southern holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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