An “incremental positive for orders” and “sequentially flat” rate increases characterized Cowen and Company’s third-quarter 2021 Rail Equipment and Rail Shipper Surveys, respectively, report analysts Jason Seidl (Railway Age’s Wall Street Contributing Editor), Matt Elkott and Elliot Alper.
Cowen Inc. and AFS Logistics, LLC on Oct. 11 launched the Cowen/AFS Freight Index, which they say “will serve to provide Cowen’s institutional clients with predictive pricing tools for multiple sectors within the freight industry, on a quarterly basis.”
Cowen and Company Managing Director and Railway Age Wall Street Contributing Editor Jason Seidl attended and participated in the North East Association of Rail Shippers (NEARS) Fall 2021 Conference in Portland, Me.,
A few days after throwing in the towel on its attempted merger with Kansas City Southern, and facing a board and management reorganization forced by activist investor and “beneficial owner” TCI Fund Management Ltd., CN on Sept. 17 announced its “Full Speed Ahead – Redefining Railroading” initiative, which it describes as an “ambitious value creation plan” consisting of, for full-year 2022, $5 billion in stock buybacks (a previously authorized C$1.1 billion of it to be completed by the end of January 2022), a decrease in capital investment to approximately 17% of revenues, C$700 million of additional, incremental operating income, a 57% operating ratio, and elimination of more than 1,000 jobs, 400 of them from operating crafts.
Despite continued market challenges, Wabtec Corp. “strengthened” its financial position in second-quarter 2021, growing its 12-month backlog—“the highest since second-quarter 2019”—and posting a “year-to-date book-to-bill above 1.0,” the company reported.
“Our ability to deliver sustainable, profitable growth has never been stronger,” Canadian Pacific (CP) President and CEO Keith Creel said during the railroad’s second-quarter 2021 earnings announcement.
CN followed potential merger partner Kansas City Southern (KCS) in reporting financial results for second-quarter 2021, noting C$3.598 billion in revenues—an increase of 12% over the prior-year period—and a 13% increase in revenue ton-miles (RTMs).
We hosted our second call with a noted transportation attorney to discuss the Executive Order signed by President Biden on July 9. It appears to be much more measured than early reporting initially indicated. The tone surrounding the railroads implied recognized independence of the Surface Transportation Board, and is likely in line with the thinking of the Marty Oberman-led organization. Longer term, we will monitor bottleneck implications.
Cowen and Company transportation analysts Jason Seidl (Managing Director and Wall Street Contributing Editor), Matt Elkott and Elliott Alper recently conducted their second-quarter 2021 rail equipment and shipper surveys. Following are the results.
Following the closing of the public comment period for the CN voting trust, which ended June 28, we are re-calibrating our expectations and now believe there to be a ~60% chance the Surface Transportation Board approves it. Our viewpoints swayed slightly in favor of CN following a closer look at the public comments over the past 20 days.