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Canadian Pacific Railway Limited Downgraded at Deutsche Bank
Nov 29, 2021 11:41 PM - Davit Kirakosyan
Image credit: FMP
Analysts at Deutsche Bank downgraded Canadian Pacific Railway Limited (NYSE:CP) to hold from buy predominantly to reflect the significant additional debt (the company is in the process of raising over C$10 billion in new debt) and new equity (the company will issue 262 new shares to pay for its KSU acquisition), as well as a bit too optimistic 2023 EPS expectations.
The analysts believe the near-term risks associated with higher debt and equity and optimistic EPS expectations have the potential to more than offset the long-term benefits of the KSU acquisition over the course of 2022.
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