Latest news for Susquehanna Community (OTC:SQCF) Stock

Susquehanna Community

Susquehanna Community Financial Inc is a United States-based bank holding company. Through its subsidiary bank, it offers general banking services to individuals and corporates. The bank provides services like mortgage services, online banking and bill pay, telephone banking, savings, checking, direct deposits, debit cards, credit cards and other services.

News

COWN

SQCF

Canadian Pacific (NYSE: CP) announced plans to acquire Kansas City Southern (NYSE: 

5 Wall Street Impressions About Proposed CP-KCS Merger

SUSQUEHANNA CMMTY FNCL by Susquehanna Community Financial, Inc.

Susquehanna Community Financial Inc

Barclays analyst Kannan Venkateshwar downgrades BCE (TSX:<a class="ticker" href="https://www.benzinga.com/stock/BCE#TSX">BCE</a>) from Equal-Weight to Underweight and lowers the price target from C$41 to C$30.

Downgrades

Price Target

Analyst Ratings

TSX:BCE

Barclays Downgrades BCE to Underweight, Lowers Price Target to C$30

WIIM

LSTA

Lisata Therapeutics shares are trading lower after the company announced preliminary cohort data from its Phase 2 Ascend trial.

HPAI

Helport AI Partners With LendSure To Boost Loan Officer Productivity, Reduce Overhead Costs, And Lower Mortgage Expenses For Borrowers; Aims For Industry-Wide Transformation Through AI Integration

HEPA

Hepion Pharmaceuticals shares are trading lower after the company announced a $9 million public offering.

BLBX

Blackboxstocks shares are trading higher after the company announced a $250K securities purchase agreement and is anticipating a potential merger.

Offerings

USEG

U.S. Energy Corp. Prices 4,236,000 Share Offering At $2.65/Share

Goldman Sachs CEO Solomon Says Rebalancing Of Certain Trade Agreements Over Time Can Be Constructive For U.S. Growth; I Think It's Hard To Dispute The Fact That Equity Multiples Are High

Recently published article on study findings underscores links between study participants infected with SARS-CoV-2 and the incidence of ME/CFS
The early-onset broad-spectrum antiviral effect of Ampligen has been observed to stimulate strong innate immune response, offering potential therapeutic benefits for people with ME/CFS or Post-COVID chronic fatigue
OCALA, Fla., Jan. 22, 2025 (GLOBE NEWSWIRE) -- <a href="https://www.globenewswire.com/Tracker?data=Lp7r-Zko8_STxa2-SCTwWJh1YHEsWboXq5jsxeXHg-SqFEWiqVGMujh5tpqwQxZY5yu2XZuEKP-kqNipNfkoTz27dgqboQ8x6ThGGR7FHqU=">AIM ImmunoTech Inc.</a> (NYSE:<a href="https://www.benzinga.com/stock/AIM#NYSE">AIM</a>)&nbsp;("AIM" or the "Company") today offered commentary on a new article in the Journal of General Internal Medicine linking COVID-19 to increased risk of Myalgic Encephalomyelitis/Chronic Fatigue Syndrome ("ME/CFS").
The article, titled "<a href="https://www.globenewswire.com/Tracker?data=Fpq1FisR8Jo1G0UQe1w_Xfyq974COCvW4D_zDbhx6_5A0ny4E4Th5BAnjftaot2-CBsrvkrvPy4vLK9ZH3_XPf6BEtDKxILgAsWUrhbxQtb9G1eL_d0RHXTAtQyiV1dDgtvGWyL_CXYP8dEKM0sl_e5o6kWll7Ml4HPjKmEAZbaCJFKGMw0km6H3jqqnBplMJoqzXHwWq6c0FZBZ48Kk9SNpfqFRHl4ud2cVHkg-JSiJXXFaA4j39hkqvOp3hWvEPVi255ewcc5zYELBzc3yQw==">Incidence and Prevalence of Post-COVID-19 Myalgic Encephalomyelitis: A Report from the Observational RECOVER-Adult Study</a>," found that among study participants infected with SARS-CoV-2, the incidence of ME/CFS was 15 times higher than pre-pandemic rates. The article's lead author, Suzanne D. Vernon, PhD, emphasized the following highlights in an <a href="https://www.globenewswire.com/Tracker?data=IFH4V9qJpmVon0e6WwLx9F-9dJ-PXSwcqmf6AWGKFGpioE4g2C0XT-vTSog6ur1kSKv3Tqel3TlMk2tZv_ZxO8FrpaAyqaJe6oAT9qQmwriMCO59gtO7iuWk983XNcr_9yKUh6iDzSoInm9YYBi9MQ==">accompanying analysis</a> posted to the Bateman Horne center website:
<ul>
<li>Of the 4,515 participants who enrolled within 30 days of contracting COVID-19, 73 developed ME/CFS at least six months post-infection.</li>
<li>In total, 531 participants met ME/CFS criteria, translating to a prevalence of 4.5% among those infected—nearly eight times higher than uninfected participants.</li>
<li>This prevalence is five times higher than pre-pandemic estimates and underscores the severe and lasting impact of COVID-19 on public health.
<ul>
<li>90% of these post-COVID-19 ME/CFS cases clustered with the most symptomatic and severe cases of Long COVID, highlighting the overlap between these two conditions.</li>
</ul>
</li>
</ul>

Biotech

General

AIM ImmunoTech Announces Commentary On Study Linking COVID-19 To Increased ME/CFS Risk; Incidence 15 Times Higher Than Pre-Pandemic Rates; Ampligen Shows Strong Antiviral Effect Beneficial For ME/CFS And Post-COVID Fatigue; 531 Of 4,515 Participants Affected

Carnival Corp (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CCL#NYSE">CCL</a>) is charting a multi-year growth path and JPMorgan analyst Matthew R. Boss sees <a href="https://www.benzinga.com/topic/cruise-lines">the cruise giant</a> setting sail for stronger returns in 2025 and beyond.
After an exclusive shipboard chat with Carnival's top brass, Boss highlights key catalysts that could drive the next leg of the stock's performance.
<h2 class="wp-block-heading">Growth Beyond The Horizon</h2>
CEO Josh Weinstein sees Carnival's diversified portfolio of eight brands as a key advantage over smaller peers, with Carnival and AIDA already surpassing 2019 performance metrics. The real opportunity? The remaining six brands, many still trailing pre-pandemic levels, are now under Weinstein's direct oversight after organizational shifts. With a focus on marketing and execution, management is counting on a strong 2025-2026 ramp-up.
While the industry worries about overcapacity, Carnival is taking a disciplined approach, adding just 0-1% annual capacity growth, well below the pre-pandemic 3%. With only 2-3% of global hotel stays coming from cruises, the U.S. and Canada remain a largely untapped market.
Read Also: <a href="https://www.benzinga.com/24/12/42657003/analysts-see-smooth-sailing-for-carnival-as-q4-results-beat-expectations">After Carnival&#8217;s Q4 Performance, Analysts See Smooth Sailing</a>
<h2 class="wp-block-heading">AI, Yield Management &amp; A &#8216;Magic Kingdom&#8217; At Sea</h2>
Carnival's revenue play isn't just about record bookings, it's about smart pricing. Enter &#8216;YODA&#8217; the company's AI-driven yield management system, designed to maximize revenue. Early results look promising, with new-to-cruise guests up 13% year-over-year and repeat bookings climbing 10%.
Meanwhile, Carnival is expanding its strategic destination assets, with the upcoming Celebration Key, set to open in mid-2025. By 2030, the company aims to handle 11 million guests annually—nearly double the 6.5 million expected in 2024. Daily capacity across its destinations will rise to 95,000, rivaling the foot traffic of Disney's Magic Kingdom.
<h2 class="wp-block-heading">Balance Sheet Detox</h2>
Debt reduction remains a priority, with Carnival slashing $7.3 billion in debt since early 2023. Interest expenses are already down 15% year-over-year, with CFO David Bernstein targeting a return to sub-3.5x leverage by FY26, a significant improvement from 6.7x in FY23.
<h2 class="wp-block-heading">Industry Implications: FX, Fuel &amp; Competitive Positioning</h2>
While Carnival is executing its multi-year plan, foreign exchange and fuel volatility remain headwinds for the broader industry. JPMorgan has adjusted (lowered) its earnings models for key competitors Royal Caribbean Group (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/RCL#NYSE">RCL</a>) and Norwegian Cruise Line Holdings Ltd (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/NCLH#NYSE">NCLH</a>) based on recent currency shifts and fuel cost increases. 
<h2 class="wp-block-heading">Investor Takeaway</h2>
Carnival is more than 80% of the way to its <a href="https://www.prnewswire.com/news-releases/carnival-corporation--plc-reports-second-quarter-2023-earnings-and-sets-sights-on-2026-sea-change-program-301862616.html">SEA Change</a> transformation targets, with long-term return on invested capital (ROIC) expected to land "at least in the teens" by 2026. With disciplined growth, AI-driven revenue strategies, and a revamped balance sheet, Carnival looks well-positioned to navigate the next phase of industry expansion. 
Investors betting on the cruise rebound might find Carnival's multi-year story compelling, especially as it leans into pricing power, brand execution and strategic destinations.
Read Next: 
<ul>
<li><a href="https://www.benzinga.com/24/12/42490038/norwegian-cruise-line-benefits-from-re-energized-consumer-spending-and-cost-savings-program-analyst-says">Norwegian Cruise Line Benefits From Re-energized Consumer Spending And Cost Savings Program, Analyst Says</a></li>
</ul>

Analyst Color

Entertainment

Long Ideas

Travel

Trading Ideas

NCLH

Carnival's Transformation: AI-Driven Yields And A Balance Sheet Reset

Comerica Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CMA#NYSE">CMA</a>) shares are trading lower in premarket Wednesday after the <a target="_blank" href="https://www.sec.gov/ix?doc=/Archives/edgar/data/0000028412/000002841225000005/cma-20250122.htm" rel="noreferrer noopener">fourth-quarter FY24 earnings result</a>.
The financial services company reported a fourth-quarter revenue increase of 5.5% to $825 million, missing the analyst consensus estimate of $837.98 million.
Net interest income increased $41 million to $575 million quarter-on-quarter, reflecting a strategic growth in core interest-bearing deposits and relationship-focused pricing.
Adjusted EPS of $1.20 also <a href="https://www.benzinga.com/earnings">missed the consensus estimate of $1.28.</a>
Average loans in the fourth quarter amounted to $50.62 billion and the return on average assets stood at 0.85%. Efficiency ratio for the quarter was 69.51.
Nonperforming assets increased $58 million to $308 million, or 0.61% of total loans and foreclosed property, compared to 0.50% in the third quarter of 2024.
The company held $850 in cash and equivalents as of December 31, 2024.
Curtis C. Farmer, Comerica Chairman and Chief Executive Officer, stated, &#8220;As expected, loans were pressured by paydowns in Commercial Real Estate, but we saw promising signals across other businesses that support our outlook for growth in 2025. Although some uncertainty remains, we believe customer sentiment is generally more optimistic about the future of the economy and plans for increased investment in their businesses.&#8221;
Outlook: Comerica <a target="_blank" href="https://www.sec.gov/ix?doc=/Archives/edgar/data/0000028412/000002841225000005/cma-20250122.htm" rel="noreferrer noopener">sees </a>FY25 net interest income growth of 6% &#8211; 7%, including the impact of BSBY cessation.
For the first quarter, the company expects net interest income to decline 1% &#8211; 2% sequentially, including the impact of BSBY cessation.
The company targets share repurchases at approximately <a target="_blank" href="https://www.benzinga.com/calendars/guidance" rel="noreferrer noopener">$50 million in the first quarter of 2025</a>.
Price Action: CMA shares traded lower by 1.78% at $65.20 in premarket at the last check Wednesday.
Image: Shutterstock/ fizkes.

Equities

Guidance

Movers

Comerica Q4 Earnings: Revenue And EPS Fall Short Amid Loan Pressures, Eyes 2025 Growth

Real Estate

PGRE

Paramount Group Sells 45% Interest In 900 Third Avenue Office Building At Gross Asset Valuation Of $210M

Amphenol (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/APH#NYSE">APH</a>) reported its Q4 earnings results on Wednesday, January 22, 2025 at 08:00 AM.
Here's what investors need to know about the announcement.
<h3>Earnings</h3>
Amphenol beat estimated earnings by 10.0%, reporting an EPS of $0.55 versus an estimate of $0.5.
Revenue was up $990.00 million from the same period last year.
<h3>Earnings History Overview</h3>
The company beat on EPS by $0.05 in the previous quarter, leading to a 2.0% increase share price change the next day.
Here's a look at Amphenol's past performance:

<table>
<thead>
<tr>
<th>Quarter</th>
<th>Q3 2024</th>
<th>Q2 2024</th>
<th>Q1 2024</th>
<th>Q4 2023</th>
</tr>
</thead>
<tbody>
<tr>
<td>EPS Estimate</td>
<td>0.45</td>
<td>0.41</td>
<td>0.37</td>
<td>0.39</td>
</tr>
<tr>
<td>EPS Actual</td>
<td>0.50</td>
<td>0.44</td>
<td>0.40</td>
<td>0.41</td>
</tr>
<tr>
<td>Revenue Estimate</td>
<td>3.80B</td>
<td>3.39B</td>
<td>3.10B</td>
<td>3.15B</td>
</tr>
<tr>
<td>Revenue Actual</td>
<td>4.04B</td>
<td>3.61B</td>
<td>3.26B</td>
<td>3.33B</td>
</tr>
</tbody>
</table>

New investors should note that it is sometimes not an earnings beat or miss that most affects the price of a stock, but the guidance (or forecast).
<h3>Guidance</h3>
Amphenol management provided guidance for Q1 2025, expecting earnings between $0.49 and $0.51 per share.
To track all earnings releases for Amphenol <a href="https://www.benzinga.com/quote/APH/earnings">visit their earnings calendar here.</a> 
This article was generated by Benzinga's automated content engine and reviewed by an editor.

Earnings

Amphenol Earnings Review: Q4 Summary

Houston American Energy Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HUSA#NYSE">HUSA</a>) (the "Company") today announced that it has entered into a definitive agreement with several investors for the purchase and sale of an aggregate of 2,600,000 shares of the Company's common stock, par value $0.001 per share (the "Common Stock") at a purchase price of $1.70 per share in a registered direct offering.
The aggregate gross proceeds to the Company of this offering are expected to be approximately $4,420,000. The transaction is expected to close on or about January 23, 2025, subject to the satisfaction of customary closing conditions.
Univest Securities, LLC is acting as the sole placement agent.

HUSA

Houston American Energy Corp. Announces $4.42M Registered Direct Offering Of 2.6M Shares Of Common Stock At A Price Of $1.70/Share

LOBO

Lobo EV Technologies Entered Into a Letter Of Intent With Roundtree Lab To Manufacture Smart Electric Medical Transport Beds

Decent Holding Inc. (the "Company"), an established wastewater treatment services provider in China, today announced the pricing of its initial public offering (the "Offering") of 1,250,000 ordinary shares (the "Ordinary Shares") at a public offering price of $4.00 per share. The Company expects to receive aggregate gross proceeds of $5 million, before deducting underwriting discounts and other offering expenses. The Ordinary Shares have been approved for listing on the Nasdaq Capital Market and are expected to commence trading on January 22, 2025, under the ticker symbol "DXST". The Offering is expected to close on January 23, 2025, subject to the satisfaction of customary closing conditions. In addition, the Company has granted the underwriters an option (the "Over-Allotment Option"), within 45 days from the closing date of the Offering, to purchase up to an additional 187,500 Ordinary Shares at the public offering price, less underwriting discounts, to cover the Over-Allotment Option, if any.
The net proceeds from the Offering will be used for (i) business expansion; (ii) research and development; (iii) promoting the river water quality management service and expanding the treatment scope of river water; (iv) development and upgrade of wastewater treatment technology; and (v) recruiting talents in research and development and management.

IPOs

DXST

Decent Holding Inc. Announces Pricing Of $5M Initial Public Offering Of 1.25M Shares At A Price Of $4/Share

Inspira Technologies Oxy BHN Ltd Ordinary Shares

IINN

Inspira Technologies Says Its ART100 Systems Have Been Delivered To Glo-Med Networks And Are Preparing For Deployment At A US Hospital

Ormat Technologies Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ORA#NYSE">ORA</a>), a leading geothermal and renewable energy company, today announced the signing of a 10-year Power Purchase Agreement (PPA) with Calpine Energy Solutions, one of North America's largest energy suppliers. Under this agreement, Calpine Energy Solutions will purchase up to 15 megawatts (MW) of clean, renewable energy from the Mammoth 2 geothermal power plant located near Mammoth Lakes, California, to support demand within its retail portfolio.
Energy deliveries under the PPA are set to begin in the first quarter of 2027 and will replace the existing PPA with the Southern California Edison Company (SCE). Notably, the new PPA, which includes an increase in production capacity and a higher price point, highlights the tight supply-demand balance of carbon-differentiated electricity in California, driven by state Renewable Portfolio Standards (RPS) compliance needs and voluntary corporate demand.

Ormat Technologies Announces 10-Year PPA With Calpine Energy Solutions For Up To 15MW From Mammoth 2 Geothermal Plant Starting Q1 2027; Replacing Southern California Edison Deal, Reflecting California's Carbon-Differentiated Electricity Demand

The Charles Schwab Corporation (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHW#NYSE">SCHW</a>) reported upbeat fourth-quarter results on Tuesday.
Revenue rose 20% year over year to $5.33 billion, beating the consensus of $5.19 billion.
Net interest revenue rose 19% Y/Y to $2.531 billion in the fourth quarter. Clients' daily average trades totaled 6.312 million, up 22% Y/Y.
Adjusted net income rose 44% Y/Y to $1.97 billion. Adjusted EPS increased 49% to $1.01, beating the consensus of $0.91.
Total client assets rose 19% Y/Y to $10.10trillion. The company's active brokerage accounts reached 36.5 million in the quarter.
Mike Verdeschi, CFO, said, "Client transactional sweep cash grew by $35 billion versus 3Q24, including a $25 billion increase in December due to typical year-end seasonality. This build helped us further reduce Bank Supplemental Funding by $14.9 billion to $49.9 billion – down ~50% from peak levels."
Charles Schwab shares gained 5.9% to close at $80.93 on Tuesday.
These analysts made changes to their price targets on Charles Schwab following earnings announcement.
<ul>
<li>Wells Fargo analyst Michael Brown upgraded Charles Schwab from Equal-Weight to Overweight and raised the price target from $89 to $93.</li>
<li>Barclays analyst Benjamin Budish maintained the stock with an Overweight and raised the price target from $95 to $96.</li>
<li>Citigroup analyst Christopher Allen maintained Charles Schwab with a Neutral and raised the price target from $80 to $85.</li>
<li>Deutsche Bank analyst Brian Bedell maintained Charles Schwab with a Buy and boosted the price target from $98 to $105.</li>
</ul>
Considering buying SCHW stock? Here&#8217;s what analysts think: 
<figure class="wp-block-image size-large is-resized"><img loading="lazy" decoding="async" width="1024" height="492" src="https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/22083203/image-154-1024x492.png" alt="" class="wp-image-744746" style="width:530px;height:auto" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/22083203/image-154-1024x492.png 1024w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/22083203/image-154-300x144.png 300w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/22083203/image-154-768x369.png 768w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/22083203/image-154.png 1117w" sizes="(max-width: 1024px) 100vw, 1024px" /></figure>
Read This Next:
<ul>
<li> <a href="https://www.benzinga.com/trading-ideas/long-ideas/25/01/43123084/top-3-health-care-stocks-that-could-blast-off-this-quarter">Top 3 Health Care Stocks That Could Blast Off This Quarter</a></li>
</ul>

Markets

SCHW

Charles Schwab Analysts Increase Their Forecasts After Upbeat Results

BDMD

Baird Medical Investment Holdings Is Expanding Its Presence Into San Francisco

<h3 class="wp-block-heading">Tech Stocks In Focus</h3>
On CNBC's &#8220;Mad Money Lightning Round,&#8221; Jim Cramer said Rigetti Computing, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/RGTI#NASDAQ">RGTI</a>) is a quantum stock. &#8220;If you want to participate in a short squeeze, this is better <a href="https://www.benzinga.com/quote/RGTI">than most,&#8221; he added</a>.
Shares of quantum stocks, including Rigetti Computing, rose sharply on Tuesday amid strength in tech and AI stocks as investors assessed the new administration&#8217;s policies and AI efforts.
Cramer recommended buying ASML Holding N.V. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/ASML#NASDAQ">ASML</a>), adding that it is a &#8220;remarkably great&#8221; company.
Supporting his view, Wells Fargo analyst Joseph Quatrochi, on Jan. 13, maintained ASML with an Overweight and raised the price target from $790 to $860.
Advanced Micro Devices (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AMD#NASDAQ">AMD</a>) is a &#8220;great&#8221; company, Cramer said. &#8220;I do think that there's a lot of people who believe that they will not be able to deliver on this quarter. I, therefore, am reluctant to get in ahead of the quarter.&#8221;
AMD will report fiscal fourth quarter and full year 2024 financial results after the closing bell on Tuesday, Feb. 4. Analysts expect the company to report quarterly earnings at $1.09 per share, up from 77 cents per share in the year-ago period.
<h3 class="wp-block-heading">Hold On To This Stock</h3>
The &#8220;Mad Money&#8221; host recommended to hold on to Dow Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DOW#NYSE">DOW</a>). &#8220;I don't want to sell it here, we might be at some sort of trough at this very moment in Dow pricing,&#8221; he added.
Recently, on Jan. 13, Morgan Stanley analyst Vincent Andrews also maintained Dow with an Equal-Weight rating and cut the price target from $59 to $46.
<h3 class="wp-block-heading">Discusses His View On Health Care Stocks</h3>
Cramer said Elanco Animal Health Incorporated (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ELAN#NYSE">ELAN</a>) is not his favorite and considers Chewy (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CHWY#NYSE">CHWY</a>) as the better bet for this group.
Adding support to Cramer's view, Stifel analyst Jonathan Block, on Jan. 7, lowered the price target on the stock from $20 to $18.
Clover Health Investments, Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/CLOV#NASDAQ">CLOV</a>) is losing a lot of money and is &#8220;just a total spec,&#8221; Cramer said.
On Nov. 6, Clover Health Investments reported worse-than-expected third-quarter revenue results.
Price Action:
<ul>
<li>Rigetti Computing shares jumped 42.2% to settle at $13.98 on Tuesday.</li>
<li>ASML shares gained 0.9% to close at $763.00 during the session.</li>
<li>AMD shares gained 0.7% to close at $122.28.</li>
<li>Dow shares gained 1.3% to settle at $41.58 on Tuesday.</li>
<li>Elanco Animal Health shares gained 0.2% to close at $12.04.</li>
<li>Clover Health Investments shares rose 3.9% to settle at $4.24 on Tuesday.</li>
</ul>
Read Next: 
<ul>
<li><a href="https://www.benzinga.com/25/01/43096091/jim-cramer-this-tech-stock-is-a-buy-louisiana-pacific-has-been-a-great-stock">Jim Cramer: This Tech Stock Is A Buy, Louisiana-Pacific Has Been A &#8216;Great Stock&#8217;</a></li>
</ul>
Image: Shutterstock

Tech

Media

ASML

CHWY

CLOV

ELAN

RGTI

Jim Cramer: AMD Is A 'Great' Company, Hold Onto Dow Inc.

<a href="https://www.cpr.ca/">Canadian Pacific</a> (NYSE:<a class="ticker" href="/stock/CP#NYSE">CP</a>) <a href="https://www.freightwaves.com/news/railroad-megamerger-could-be-boom-for-shippers">announced plans</a> to acquire <a href="https://www.kcsouthern.com/">Kansas City Southern</a> (NYSE:<a class="ticker" href="/stock/KSU#NYSE">KSU</a>) for $29 billion on Sunday morning. Here are five initial impressions from Wall Street transportation analysts about this proposed transaction.

<h3 id="h-wall-street-likes-the-deal">Wall Street likes the deal</h3>

The merger of CP and Kansas City Southern (KCS) would be combining two of the smallest Class I railroads. It would also be integrating two railroads that are striving to reach an operating ratio (OR) in the mid-50s. OR, represented in a percentage such as 55%, is a tool investors use to gauge the financial health of a company, with a lower OR implying improved financial health.&nbsp;

&quot;We believe the fit of the two rail systems and strategic logic is good. Both railroads have track records of delivering volume growth and the significant extension of CP&#39;s reach should allow meaningful revenue synergies,&quot; said a Monday note from UBS (NYSE:<a class="ticker" href="/stock/UBS#NYSE">UBS</a>) transportation analyst Tom Wadewitz.

However, like other observers, Wall Street will also be watching how the <a href="https://www.stb.gov/" rel="noreferrer noopener" target="_blank">Surface Transportation Board</a>, the regulatory body that would approve the merger, <a href="https://www.freightwaves.com/news/surface-transportation-board-chair-weighs-in-on-proposed-mergers" rel="noreferrer noopener" target="_blank">considers CP&#39;s proposed acquisition</a>, noting that the board has been mindful of shippers&#39; concerns in recent and ongoing proceedings.

<h3 id="h-could-the-third-time-be-a-charm">Could the third time be a charm?</h3>

CP has considered merging with two other Class I railroads &mdash; <a href="https://www.csx.com/" rel="noreferrer noopener" target="_blank">CSX</a> (NYSE:<a class="ticker" href="/stock/CSX#NYSE">CSX</a>) and <a href="http://www.nscorp.com/" rel="noreferrer noopener" target="_blank">Norfolk Southern</a> (NYSE:<a class="ticker" href="/stock/NSC#NYSE">NSC</a>) &mdash; in the past seven years. But this merger would be different because it would be with a much smaller railroad revenuewise.

&quot;The regulatory consideration is an important one because in 2016, during CP&#39;s attempted takeover of Norfolk Southern (NSC), the attempt ended after heightened scrutiny from the Obama administration on antitrust issues,&quot; said Deutsche Bank (NYSE:<a class="ticker" href="/stock/DB#NYSE">DB</a>) analyst Amit Mehrotra. &quot;But we note at that time NSC rejected CP&#39;s offer, whereas [this] announcement is a friendly deal, and KSU is only about one-fourth the size of NSC from a revenue standpoint &mdash; i.e., pro forma for the deal CPKC will still be the smallest Class I rail.&quot; CPKC stands for the name for the new company.&nbsp;

<h3 id="h-could-this-result-in-more-mergers-and-acquisitions">Could this result in more mergers and acquisitions?</h3>

Although analysts are uncertain whether the CP-KCS transaction will result in a wave of mergers and acquisitions with the freight railroad industry, the proposed acquisition points to an industry that seeks to pivot to growth after implementing <a href="https://www.freightwaves.com/news/what-is-precision-scheduled-railroading-psr" rel="noreferrer noopener" target="_blank">precision scheduled railroading</a> (PSR), an operational tool that seeks to streamline operations and cut costs.&nbsp;

&quot;This transaction could get other railroads thinking about the urge to merge. Aside from other mergers, CPKC is targeting nearly $800 [million] in revenue synergies by 2025. These are likely to be spread fairly evenly over the time frame and come from three main buckets: intermodal/automotive, bulk and carload,&quot; said Cowen (NASDAQ:<a class="ticker" href="/stock/COWN#NASDAQ">COWN</a>) analyst Jason Seidl in a Monday note. &quot;Some of these wins will undoubtedly be taken off the highway as a complete interline service should make for a more reliable rail product. On its deal call, management mentioned that it plans to offer new services as well due to the increased reach and specifically mentioned some routes east of Chicago. Some of these could be taken from other rail operators in our view.&quot;

Bascome Majors, analyst for Susquehanna Financial Group (OTC:<a class="ticker" href="/stock/SQCF#OTC">SQCF</a>), said, &quot;To be clear, we wouldn&#39;t expect other Class I deals to be announced near term, with executives, boards and advisers of other rails closely watching the CP-KSU litmus test for the STB&#39;s current merger appetite before diving in. But if CP-KSU were to show signs of regulatory traction, a full-fledged final round of Class I consolidation could follow in 2022-2025.&quot;

<h3 id="h-which-railroads-would-be-affected-by-this">Which railroads would be affected by this?</h3>

Competing Canadian railway <a href="https://www.cn.ca/" rel="noreferrer noopener" target="_blank">CN</a> (NYSE:<a class="ticker" href="/stock/CNI#NYSE">CNI</a>) is likely to be affected by the merger since it has a T-shaped network consisting of the two Canadian coasts and the U.S. Gulf Coast.&nbsp; The CP-KCS combination would also have a T-shaped network.

But <a href="http://www.up.com/" rel="noreferrer noopener" target="_blank">Union Pacific</a> (NYSE:<a class="ticker" href="/stock/UNP#NYSE">UNP</a>) could face a potential share shift, particularly for automotive and intermodal traffic, because of its cross-border network with Mexico. <a href="https://www.bnsf.com/" rel="noreferrer noopener" target="_blank">BNSF</a> (NYSE:<a class="ticker" href="/stock/BRK#NYSE">BRK</a>) could also be exposed as well to potential competition for grain transport in the Upper Midwest.

&quot;The potential combination of CP and KSU would create a stronger north-south railroad competitor to UNP and CNI,&quot; Wadewitz said. &quot;UNP has an efficient route structure from Chicago to Texas and the border at Laredo and CP/KSU would also become a stronger competitor on traffic running north-south in the U.S. We would expect CP and KSU to move a portion of their interchange traffic with other railroads onto the new combined system if the deal is approved.&quot;

<h3 id="h-but-there-is-still-a-lot-of-regulatory-uncertainty">But there is still a lot of regulatory uncertainty</h3>

Despite initial expectations that STB would likely approve the deal, industry consolidation in the 1980s and 1990s has led to a field consisting of seven Class I railroads. Regulators &mdash; and shippers especially &mdash; are wary of additional consolidation.&nbsp;

&quot;To be clear, we do believe the STB will ultimately approve the CP-KSU merger. But we&#39;re also prepared for the process to drag on beyond the mid-2022 approval timeline management laid out today, with an approval potentially including conditions offering modest concessions to customers and competitors,&quot; Majors said.&nbsp;

<a href="https://freightwaves.com/subscribe" rel="noreferrer noopener" target="_blank">Subscribe to FreightWaves&#39; e-newsletters and get the latest insights on freight right in your inbox</a>.

<a href="https://www.freightwaves.com/news/author/joannamarsh" rel="noreferrer noopener" target="_blank">Click here for more FreightWaves articles by Joanna Marsh</a>.

Related articles:

<a href="https://www.freightwaves.com/news/surface-transportation-board-chair-weighs-in-on-proposed-mergers" rel="noreferrer noopener" target="_blank">Surface Transportation Board chair weighs in on proposed mergers</a>

<a href="https://www.freightwaves.com/news/railroad-megamerger-could-be-boom-for-shippers" rel="noreferrer noopener" target="_blank">Railroad megamerger could be boon for shippers</a>

<a href="https://www.freightwaves.com/news/breaking-canadian-pacific-intends-to-acquire-kansas-city-southern" rel="noreferrer noopener" target="_blank">Canadian Pacific intends to acquire Kansas City Southern for $29B</a>

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