Canadian National Railway Company (TSX:CNR) is a key player in North American logistics, offering a comprehensive range of transportation services across Canada and the United States. The company operates an extensive rail network and provides intermodal, trucking, and supply chain solutions to industries such as automotive, coal, fertilizers, forest products, metals and minerals, petroleum and chemicals, and consumer goods. With over a century of operations, CN has established itself as a crucial backbone of trade and commerce in North America.
Despite facing recent challenges, CN continues to expand its operations strategically. The company recently finalized the acquisition of the Iowa Interstate Railroad, strengthening its connectivity in the Midwest United States. This acquisition enhances CN’s service offerings, allowing for more efficient cross-border transportation and reinforcing its competitive edge. Additionally, CN’s focus on automation and technology-driven logistics solutions has positioned it well for long-term growth.
Key Business Segments
- Rail Freight Transportation
- Provides rail services for bulk commodities, consumer goods, and industrial materials.
- Serves key sectors including agriculture, energy, and manufacturing.
- Intermodal & Supply Chain Services
- Offers logistics solutions, including trucking and warehousing, to streamline cargo movement.
- Expanding partnerships with major ports to enhance trade flow.
- Infrastructure & Real Estate
- Owns and manages critical rail infrastructure, ensuring operational efficiency.
- Develops logistics parks to facilitate freight distribution.
Why Canadian National Railway (TSX:CNR) Stands Out
CN has demonstrated resilience despite facing operational disruptions. In August 2024, a labor dispute led to a temporary shutdown of freight operations, disrupting supply chains across Canada. However, swift arbitration by the government allowed CN to resume normal operations, mitigating potential long-term damage. Additionally, wildfires in Alberta further pressured CN’s logistics network, leading the company to adjust its profit forecasts for the year.
Nonetheless, CN remains focused on growth. The recent acquisition of the Iowa Interstate Railroad marks a strategic expansion, bolstering its presence in the U.S. Midwest and enhancing service capabilities. The company is also investing in automation and fuel-efficient locomotives, ensuring long-term sustainability and cost savings.
Stock Performance Analysis: Canadian National Railway (TSX:CNR)
| Metric | Value |
|---|---|
| 1-Year Stock Growth | +12.8% |
| Dividend Yield | 2.03% |
| Forward P/E | 15.74x |
| Price/Book Ratio | 4.36x |
CN’s financial performance remains stable, with steady revenue growth and a consistent dividend yield, making it an attractive option for long-term investors.
📌 Canadian National Railway’s stock performance over the past year shows a peak near $177 before trending downward, reflecting broader market conditions and industry challenges.
Peer Comparison: Canadian National Railway (TSX:CNR) vs. Competitors
| Code | Name | GIC Sector | Market Cap | Beta | 52-Week High | 52-Week Low | 50-Day MA | 200-Day MA | Shares Short | Short Ratio | Short Percent |
|---|---|---|---|---|---|---|---|---|---|---|---|
| TRI | Thomson Reuters Corp | Industrials | 114.91B | 0.333 | 260.45 | 201.87 | 241.86 | 232.89 | 1,335,753 | 2.92 | 0.008 |
| CP | Canadian Pacific Railway Ltd | Industrials | 98.39B | 0.775 | 122.76 | 101.63 | 110.22 | 109.73 | 4,356,268 | 2.75 | 0.0047 |
| CNR | Canadian National Railway Co | Industrials | 86.26B | 0.644 | 177.40 | 135.72 | 146.76 | 155.42 | 3,635,081 | 2.78 | 0.0098 |
| WCN | Waste Connections Inc | Industrials | 69.48B | 0.804 | 280.08 | 218.98 | 262.30 | 251.10 | 607,184 | 2.04 | 0.0027 |
| WSP | WSP Global Inc | Industrials | 31.48B | 0.753 | 264.87 | 200.27 | 250.55 | 235.98 | 1,041,495 | 3.93 | 0.0042 |
| GFL | GFL Environmental Holdings Inc | Industrials | 26.33B | 1.051 | 68.98 | 41.88 | 63.98 | 58.22 | 1,874,204 | 6.58 | 0.0102 |
| RBA | Ritchie Bros Auctioneers | Industrials | 26.22B | 0.937 | 152.48 | 94.54 | 135.11 | 120.62 | 664,416 | 2.51 | 0.0041 |
| STN | Stantec Inc | Industrials | 13.28B | 0.806 | 129.39 | 103.09 | 113.46 | 113.93 | 789,508 | 2.52 | 0.0083 |
| EFN | Element Fleet Management Corp | Industrials | 11.22B | 0.904 | 30.35 | 20.92 | 28.71 | 27.66 | 2,895,111 | 4.70 | 0.022 |
| CAE | CAE Inc. | Industrials | 11.19B | 1.931 | 39.17 | 22.28 | 34.91 | 28.72 | 6,583,435 | 7.19 | 0.0104 |
📌 This table compares Canadian National Railway (CNR) with its top competitors in the industrial sector, analyzing market cap, stock performance, and short interest. CNR remains a strong player in the transportation industry with steady performance and growth potential.
Valuation Measures: Canadian National Railway (TSX:CNR)
| Metric | Current | 12/31/2024 | 9/30/2024 | 6/30/2024 | 3/31/2024 | 12/31/2023 |
|---|---|---|---|---|---|---|
| Market Cap | 86.26B | 91.66B | 99.58B | 102.85B | 114.20B | 107.87B |
| Enterprise Value | 107.24B | 112.32B | 120.01B | 122.46B | 132.61B | 126.07B |
| Trailing P/E | 19.61 | 17.27 | 18.81 | 19.18 | 20.91 | 22.60 |
| Forward P/E | 17.42 | 17.70 | 18.42 | 20.20 | 22.27 | 20.58 |
| Price/Sales | 5.12 | 5.44 | 6.00 | 6.29 | 6.99 | 6.57 |
| Price/Book | 4.10 | 4.71 | 5.13 | 5.14 | 5.65 | 5.36 |
| Enterprise Value/Revenue | 6.29 | 6.55 | 7.04 | 7.30 | 7.88 | 7.46 |
| Enterprise Value/EBITDA | 12.42 | 12.56 | 13.45 | 13.73 | 14.69 | 14.04 |
📌 This valuation table highlights Canadian National Railway’s (CNR) financial standing over time. While its market cap and enterprise value have fluctuated, the company’s strong price-to-earnings and price-to-sales ratios indicate steady growth in the transportation sector.
Final Thoughts
CN remains a dominant force in the North American railway industry, navigating economic uncertainties while expanding strategically. With a strong financial foundation, a growing network, and continued investment in technology and sustainability, CN is well-positioned for long-term success.
Key Takeaways:
- Operational Resilience: Despite labor disputes and environmental disruptions, CN has maintained its strong market presence.
- Strategic Expansion: The acquisition of the Iowa Interstate Railroad enhances CN’s network and service capabilities.
- Long-Term Investment Appeal: CN offers a stable dividend and consistent revenue growth, making it an attractive stock for long-term investors.
Investors looking for a reliable transportation stock with strong growth potential should keep an eye on CN’s continued expansion and strategic developments.
