In a report released yesterday, Fadi Chamoun from BMO Capital maintained a Buy rating on Canadian National Railway (CNI – Research Report), with a price target of C$175.00.
Fadi Chamoun has given his Buy rating due to a combination of factors including Canadian National Railway’s strong pipeline of self-help opportunities and its valuation trading at discounted levels. The company is expected to achieve 10-15% EPS growth, driven by low- to mid-single-digit volume gains, with a portion coming from company-specific initiatives. The visibility into this growth pipeline is high, with several projects already underway, such as a refined fuel transload facility and a frac sands terminal.
Furthermore, despite potential macro and trade policy risks, the medium-term outlook remains favorable, supported by initiatives to develop Canadian natural resources and eliminate intra-Canada trade barriers. These factors, coupled with a recovery in market share to pre-disruption levels, suggest that the company could meet or exceed its guidance range. The risk/reward profile is viewed as favorable, reinforcing the Buy rating.
Based on the recent corporate insider activity of 38 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of CNI in relation to earlier this year.