Canadian Pacific Kansas City (CP) Citi's Global Industrial Tech & Mobility Conference 2026 summary

Operational performance and growth outlook

• Operational momentum remains strong, with best-ever first-quarter metrics despite challenging weather.

• Grain volumes are at record levels, with positive RTM growth expected to accelerate in Q2.

• Automotive and intermodal segments are outperforming industry trends, with new products like SMX and Americold driving future growth.

• Network investments and capacity expansions position the company for sustained low incremental margin growth.

• Double-digit earnings and margin improvement are targeted, even with macroeconomic headwinds.

Pricing, capacity, and efficiency

• Pricing has exceeded 4% due to network value, with further upside as macro conditions normalize.

• Extended length of haul and improved asset turns are driving higher revenue per car.

• Capacity investments, including new locomotives and terminal upgrades, support future volume growth.

• Incremental margins on new volume remain in the 60%-70% range.

• CapEx is being reduced by 15%, with a sustainable level of CAD 2.6–2.7 billion expected.

Strategic initiatives and shareholder returns

• Synergy targets have increased from CAD 1 billion to CAD 1.5 billion, with CAD 1.2 billion already realized.

• Free cash flow is expected to improve, supporting a 5% stock buyback and regular dividend increases.

• Double-digit core adjusted EPS growth is targeted through 2028, with macro normalization as the key variable.

• Efficiency gains from deregulation and technology adoption are beginning to materialize, with further regulatory changes anticipated.

• New products and partnerships, such as with Americold and Schneider, are in early growth stages with significant upside.