UPDATE: Deutsche Bank Downgrades Canadian Pacific Railway Limited (CP) to Hold
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Deutsche Bank analyst Amit Mehrotra downgraded Canadian Pacific Railway Limited (NYSE: CP) from Buy to Hold with a price target of $80.00 (from $81.00).
The analyst comments "We have great respect for CP’s management team. We believe CEO Keith Creel is clearly the best railroad operator in the world, and the team, as a whole, have produced the best operating and financial results over the last several years. In this context, our downgrade of CP shares to Hold from Buy is more reflective of significant add’l debt and new equity (CP is in the process of raising over C$10 billion in new debt and will issue 262 new shares to pay for its KSU acquisition...about a year before the acquisition receives final approval), as well as 2023 EPS expectations that we think are a bit too optimistic. The bottom line is we believe the near-term risks associated with higher debt and equity + optimistic EPS expectations have potential to more than offset the long-term benefits of the KSU acquisition over the course of 2022."
Shares of Canadian Pacific Railway Limited closed at $71.31 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst PT Change, Downgrades
Related EntitiesDeutsche Bank, Earnings, Definitive Agreement
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