NEW YORK (TheStreet) -- RBC Capital Markets upgraded Canadian Pacific Railway (CP) - Get Report stock to "outperform" from "sector perform" on Friday morning. The firm has lowered its price target to C$179 from C$189.
The Canada-based company operates a transcontinental railway in Canada and the U.S. and provides logistics and supply chain expertise.
"Management has transformed CP into one of the most efficient, well-positioned companies in the rail space - and arguably one of the highest quality large-cap names in the Canadian marketplace," RBC Capital said in an analyst note.
With the company's shares down by 40% from peak, the firm believes valuations have more than accounted for risk and are a function of the rapid deterioration in the overall demand environment, driven largely by commodity price weakness.
Additionally, Canadian Pacific Railway said yesterday it would cut up to 1,000 jobs this year as slow economic conditions pressure some of its key freight volumes, the Wall Street Journal reported.
The job cuts were announced after the release of the company's 2015 fourth quarter earnings results, which missed analysts' expectations.
The company reported adjusted earnings of C$2.72 a share, lower than analysts' expectations of C$2.78 a share, the Journal added.
Revenue dropped just over 4% to C$1.69 billion, missing the C$1.72 billion analysts expected. The slump was partly due to lower metals and crude oil shipments, the Journal noted.
Shares of Canadian Pacific Railway are soaring by 10.73% to $115.90 on Friday morning.
Separately, TheStreet Ratings Team has a "hold" rating with a score of C+ on the stock.
The primary factors that have impacted the rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks.
The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and good cash flow from operations.
However, as a counter to these strengths, the team also finds weaknesses including a generally disappointing performance in the stock itself, unimpressive growth in net income and generally higher debt management risk.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: CP