Kansas City Southern’s Valuation Is Difficult To Defend

Source: Wall Street Journal
We are getting an idea of how much the pandemic has impacted corporate profits. Cyclical names have been hurt more than others. Kansas City Southern (KSU) reported Q2 revenue of $547.9 million, GAAP EPS of $1.16 and non-GAAP EPS of $1.15. Revenue fell 23% Y/Y. Combined U.S. rail traffic for the first 28 weeks of 2020 fell by double digits, implying rail traffic for the second half of the year could also falter.
KSU’s Q2 rail traffic fell 21% Y/Y, while average selli…

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