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Canadian Pacific Kansas City's total free cash flow for the
months ended in Jun. 2026 was
$684 Mil.
Its total free cash flow for the trailing twelve months (TTM) ended in Jun. 2026 was $1,730 Mil.
During the past 3 years, the average Free Cash Flow per Share Growth Rate was -5.10% per year.
During the past 5 years, the average Free Cash Flow per Share Growth Rate was 2.00% per year.
During the past 10 years, the average Free Cash Flow per Share Growth Rate was 8.90% per year.
Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Free Cash Flow Growth Rate using Free Cash Flow per Share data.
During the past 13 years, Canadian Pacific Kansas City's highest 3-Year average Free Cash Flow per Share Growth Rate was 77.50% per year. The lowest was -32.00% per year. And the median was 12.20% per year.
Canadian Pacific Kansas City (NYSE:CP) Free Cash Flow Explanation
Free Cash Flow is very close to Warren Buffett's definition of Owner's Earnings, except that in Warren Buffett's Owner's Earnings, the spending for Property, Plant, and Equipment is only for maintenance (replacement), while in the Free Cash Flow calculation, the cost of new Property, Plant, and Equipment due to business expansion is also deducted. There, Free Cash Flow is more conservative than Owner's Earnings.
In Don Yacktman's calculation of forward rate of return, he uses Free Cash Flow for the calculation. Yacktman explained the forward rate of return concept in detail in his interview with GuruFocus. Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation.
This is what Yacktman said in his March 2012 interview - when the S&P 500 was at 1400:
If the business is stable, this calculation is fairly straightforward. For instance, on the S&P 500 we would normalize earnings. We would then calculate what percentage of those earnings are not reinvested in the underlying businesses and are therefore free. Historically, for the S&P 500, this has been just under 50% of earnings. Currently, we expect the S&P to earn about 70 on a normalized basis, a number which is far below reported earnings due to our adjusting for record high profit margins. $70 X ½ / 1400 gives you a normalized free cash flow yield of approximately 2.5%.
The historical real growth rate of the S&P 500 (companies) is about 1.5%. Assuming an inflation rate of 2.5%, the forward rate of return on an investment in the S&P 500 is about 6.5% today (2.5% free cash flow yield plus 1.5% real growth plus 2.5% inflation).
For the growth part of the Forward Rate of Return calculation, GuruFocus uses the 5-year average growth rate of EBITDA per share as the growth rate, and the growth rate is always capped at 20%. For the Free Cash Flow we use per share data averaged over five years. The reason we use five years is because research shows that five years is the length of the typical business cycle.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Be Aware
Free Cash Flow within a report period can be affected by management's decisions of capital spending. Therefore, it is important to look at long term when it comes to Free Cash Flow.
Canadian Pacific Kansas City Free Cash Flow Related Terms
Canadian Pacific Kansas City Free Cash Flow Historical Data
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Canadian Pacific Kansas City Free Cash Flow Calculation
Free Cash Flow is considered one of the most important parameters to measure a company's earnings power by value investors because it is not subject to estimates of Depreciation, Depletion and Amortization (DDA). However, when we look at the Free Cash Flow, we should look from a long term perspective, because any year's Free Cash Flow can be drastically affected by the spending on Property, Plant, & Equipment (PPE) of the business in that year. Over the long term, Free Cash Flow should give pretty good picture on the real earnings power of the company.
Free Cash Flow for the trailing twelve months (TTM) ended in Jun. 2026 adds up the quarterly data reported by the company within the most recent 12 months, which was $1,730 Mil.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Canadian Pacific Kansas City (CP) has a Free Cash Flow of $1,730 Mil as of Jun. 2026. Free cash flow represents the total amount of cash a company has on hand following operating and capital expenditures. View historial data for Canadian Pacific Kansas City and its competitors.
Is Canadian Pacific Kansas City's Free Cash Flow too high?
Canadian Pacific Kansas City's current Free Cash Flow is $1,730 Mil. Overall, Canadian Pacific Kansas City has a GF Score™ of 84/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Canadian Pacific Kansas City's Free Cash Flow compare to UNP and CSX?
Canadian Pacific Kansas City's Free Cash Flow of $1,730 Mil can be compared against companies in the Transportation industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Free Cash Flow for a Transportation company?
A good Free Cash Flow depends on the Transportation industry context. However, Free Cash Flow should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Free Cash Flow mean?
A high Free Cash Flow can signal that a stock is expensive relative to its fundamentals. Free cash flow represents the total amount of cash a company has on hand following operating and capital expenditures. View historial data for Canadian Pacific Kansas City and its competitors. Canadian Pacific Kansas City's current Free Cash Flow is $1,730 Mil. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Canadian Pacific Kansas City stock overvalued right now?
Based on GuruFocus' analysis, Canadian Pacific Kansas City (CP) is currently considered Fairly Valued. The stock's GF Value™ is $89.75, compared to a current price of $89.23 — trading 0.6% below its estimated fair value. The current Free Cash Flow is $1,730 Mil. Canadian Pacific Kansas City's overall GF Score™ is 84/100 with 10 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Free Cash Flow calculated?
Free Cash Flow is calculated from a company's financial statements. For Canadian Pacific Kansas City (CP), the current Free Cash Flow is $1,730 Mil as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Canadian Pacific Kansas City (CP) Overvalued in 2026?
Based on GuruFocus' analysis, Canadian Pacific Kansas City stock appears to be undervalued.
The current stock price of $89.23 is trading 0.6% below its estimated GF Value™ of $89.75.
GuruFocus considers Canadian Pacific Kansas City to be Fairly Valued.
Key valuation signals for CP:
Free Cash Flow: $1,730 Mil
GF Value™: $89.75 vs. price of $89.23 (0.6% below fair value)
No single metric tells the full story. See the CP stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Canadian Pacific Kansas City is a Class I railroad operating on tracks that span most of Canada and into parts of the Midwestern and Northeastern United States. Following the April 2023 Kansas City Southern merger, CPKC operates new single-linehaul services from Canada and the Upper Midwest down through Texas, the Gulf of Mexico, and into Mexico. It also hauls cross-border and intra-Mexico freight via operating concessions on more than 3,000 miles of rail in Mexico. CPKC hauls shipments of grain, intermodal containers, energy products (like crude and frac sand), chemicals, plastics, coal, fertilizer and potash, automotive products, and a diverse mix of other merchandise.
84GF Score
Get the complete analysis for CP
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