Down 7% in just two days, it may be time to scoop up some stock in Canada's second biggest railway.
Canadian Pacific Railway Ltd. shares have fallen 7% since last Thursday, when management announced fourth-quarter earnings that beat the Street, but also let known their less-than-rosy thoughts about the coming year.
"Management spent considerable time on
2010 headwinds and a relatively cautious view on volumes," said Walter Spracklin, RBC Capital Markets analyst.
"Even pricing
renewals of 4% are expected to be negatively impacted in 2010.
While the near-term sentiment puts some pressure on
the share price in the near-term, Mr. Spracklin continues to like the operating leverage opportunity at CP and recommends buying on weakness to clients.
He maintained his Outperform rating and $65 price target.