Canadian Pacific Railway Stock Beta
| CP Stock | CAD 100.56 1.34 1.32% |
By evaluating key metrics such as revenue growth, profitability, cash flow trends, and balance sheet strength, investors can better assess Canadian Pacific's long-term financial health and intrinsic value.
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Canadian Pacific Railway Company Beta Analysis
Canadian Pacific's Beta is one of the most important measures of equity market volatility. Beta can be thought of as asset elasticity or sensitivity to market. In other words, it is a number that shows the relationship of an equity instrument to the financial market in which this instrument is traded. For example, if Beta of equity is 2, it is expected to significantly outperform market when the market is going up and significantly underperform when the market is going down. Similarly, Beta of 1 indicates that an asset and market will generate similar returns over time.
Current Canadian Pacific Beta | 1.06 |
Most of Canadian Pacific's fundamental indicators, such as Beta, are part of a valuation analysis module that helps investors searching for stocks that are currently trading at higher or lower prices than their real value. If the real value is higher than the market price, Canadian Pacific Railway is considered to be undervalued, and we provide a buy recommendation. Otherwise, we render a sell signal.
In a nutshell, Beta is a measure of individual stock risk relative to the overall volatility of the stock market. and is calculated based on very sound finance theory - Capital Assets Pricing Model (CAPM).However, since Beta is calculated based on historical price movements it may not predict how a firm's stock is going to perform in the future.
| Competition |
In accordance with the recently published financial statements, Canadian Pacific Railway has a Beta of 1.06. This is 22.63% lower than that of the Ground Transportation sector and 23.19% lower than that of the Industrials industry. The beta for all Canada stocks is notably lower than that of the firm.
Canadian Beta Peer Comparison
Stock peer comparison is one of the most widely used and accepted methods of equity analyses. It analyses Canadian Pacific's direct or indirect competition against its Beta to detect undervalued stocks with similar characteristics or determine the stocks which would be a good addition to a portfolio. Peer analysis of Canadian Pacific could also be used in its relative valuation, which is a method of valuing Canadian Pacific by comparing valuation metrics of similar companies.Canadian Pacific is currently under evaluation in beta category among its peers.
Canadian Pacific returns are very sensitive to returns on the market. As the market goes up or down, Canadian Pacific is expected to follow.
Canadian Fundamentals
| Return On Equity | 0.0827 | ||||
| Return On Asset | 0.0429 | ||||
| Profit Margin | 0.26 % | ||||
| Operating Margin | 0.38 % | ||||
| Current Valuation | 119.01 B | ||||
| Shares Outstanding | 930.46 M | ||||
| Shares Owned By Insiders | 0.10 % | ||||
| Shares Owned By Institutions | 75.64 % | ||||
| Number Of Shares Shorted | 5.66 M | ||||
| Price To Earning | 25.10 X | ||||
| Price To Book | 2.11 X | ||||
| Price To Sales | 6.40 X | ||||
| Revenue | 14.55 B | ||||
| Gross Profit | 7.76 B | ||||
| EBITDA | 7.76 B | ||||
| Net Income | 3.71 B | ||||
| Cash And Equivalents | 739 M | ||||
| Cash Per Share | 1.36 X | ||||
| Total Debt | 2.82 B | ||||
| Debt To Equity | 1.34 % | ||||
| Current Ratio | 0.60 X | ||||
| Book Value Per Share | 51.30 X | ||||
| Cash Flow From Operations | 5.27 B | ||||
| Short Ratio | 3.81 X | ||||
| Earnings Per Share | 4.49 X | ||||
| Price To Earnings To Growth | 2.38 X | ||||
| Target Price | 119.33 | ||||
| Number Of Employees | 19.99 K | ||||
| Beta | 1.06 | ||||
| Market Capitalization | 94.81 B | ||||
| Total Asset | 87.74 B | ||||
| Retained Earnings | 19.43 B | ||||
| Working Capital | (2.28 B) | ||||
| Current Asset | 1.54 B | ||||
| Current Liabilities | 1.45 B | ||||
| Annual Yield | 0.01 % | ||||
| Five Year Return | 0.92 % | ||||
| Net Asset | 87.74 B |
About Canadian Pacific Fundamental Analysis
The Macroaxis Fundamental Analysis modules help investors analyze Canadian Pacific Railway's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Canadian Pacific using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Canadian Pacific Railway based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.
Pair Trading with Canadian Pacific
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Canadian Pacific position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Canadian Pacific will appreciate offsetting losses from the drop in the long position's value.Moving against Canadian Stock
| 0.62 | WRR | Walker River Resources | PairCorr |
| 0.35 | IGM | IGM Financial Earnings Call This Week | PairCorr |
| 0.34 | ALTA | Altamira Gold Corp | PairCorr |
The ability to find closely correlated positions to Canadian Pacific could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Canadian Pacific when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Canadian Pacific - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Canadian Pacific Railway to buy it.
The correlation of Canadian Pacific is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Canadian Pacific moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Canadian Pacific Railway moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Canadian Pacific can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in Canadian Pacific Railway. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in estimate. You can also try the Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.