Canadian National Railway: Stock Forecast & Analysis on Profit Adjustment

Canadian National Railway Co. (CNR:CA) (CNI)

Recent Developments

Canadian National Railway recently adjusted its profit forecast for 2024, citing the adverse effects of labor stoppages and wildfires in Alberta. The company estimated that these issues have negatively impacted its earnings by approximately 20 cents per share in the current quarter. Despite these challenges, CN has reported that its operations have since stabilized following a period of uncertainty.

CNR now anticipates adjusted diluted earnings per share (EPS) growth to be in the low single-digit percentage range, down from its previous forecast of mid to high single-digit growth. The company has also revised its expected adjusted return on invested capital (ROIC) to a range of 13% to 15%, from the earlier forecast of around 15%. For the 2024-2026 period, CN aims for compounded annual adjusted diluted EPS growth in the high single-digit percentage range.

Analyst Ratings and Targets

• Average Analyst Target Price: CAD 175.00
• Average Analyst Rating: Buy
• Stock Target Advisor Analysis: Stock Target Advisor’s analysis Bullish (based on 7 positive signals and 2 negative signals)

Current Stock Price: CAD 157.65

Recent Analyst Updates (September 11, 2024):

• RBC: Maintains a Hold rating with a target price of CAD 160.
• BMO Capital Markets: Rates the stock as Buy, with a target price of CAD 178.
• Raymond James: Has an Outperform rating but has reduced the target price to CAD 180.
• Scotia Capital: Also rates the stock as Outperform, with a decreased target of CAD 180.
• CIBC World Markets: Gives a Neutral rating, lowering the target price to CAD 160.
• Desjardins Securities: Assigns a Buy rating, with a revised target price of CAD 181.
• Bank of America Merrill Lynch: Continues with a Buy rating, setting a target price of CAD 175.
• STA Research: Provides a Hold rating, with a target price of CAD 155.

Stock Performance:

• 1-Week Change: -1.33%
• 1-Month Change: +3.57%
• 1-Year Change: +6.28%

Impact & Outlook

 Canadian National Railway Co. faces a mixed landscape with recent operational challenges impacting its profit outlook. Despite these issues, the company’s recovery and the generally positive analyst ratings suggest that the long-term outlook remains favorable. Investors should weigh the revised earnings forecasts and ROIC expectations against the overall positive sentiment and potential for future growth. As always, it is prudent to monitor further developments and company performance relative to its targets and industry conditions.