We recently issued an updated report on Canadian Pacific Railway Limited CP.

We are impressed by the company's efforts to reward its shareholders. To this end, the company hiked its dividend payout by 15% to C$0.95 per share (C$3.8 annually) in July, mainly owing to increased efficiencies, courtesy of the precision scheduled railroading model.

Canadian Pacific is performing brilliantly with respect to grain movement. To this end, the company set a record with respect to movement of Canadian grain and grain products in 2020. Last year, the railroad operator moved 31.32 million metric tonnes (MMT) of Canadian grain and grain products, more than any previous calendar year.

Meanwhile, we are concerned about Canadian Pacific’s high-debt levels. The company had cash and cash equivalents of C$147 million, way below its debt (maturing within one year) of C$1,186 million at the end of fourth quarter. This implies that the company does not have sufficient cash to meet its current debt obligations.

Zacks Rank & Stocks to Consider

Canadian Pacific currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Zacks Transportation sector are Kansas City Southern KSU, FedEx Corporation FDX and Herc Holdings Inc. HRI. Kansas City and FedEx carries a Zacks Rank #2 (Buy), while Herc Holdings sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term expected earnings per share (three to five years) growth rate for Kansas City, FedEx and Herc Holdings is pegged at 15%, 12% and 31.2%, respectively.

Time to Invest in Legal Marijuana

If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.

After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%

You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.

Today, Download Marijuana Moneymakers FREE >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
FedEx Corporation (FDX) : Free Stock Analysis Report
 
Canadian Pacific Railway Limited (CP) : Free Stock Analysis Report
 
Herc Holdings Inc. (HRI) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research