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    Operational Gains And Rail Merger Risks Might Change The Case For Investing In Canadian National Railway (TSX:CNR)

    Simply Wall St·01/04/2026 23:24:57
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    • In recent months, Canadian National Railway has delivered solid operational results and efficiency gains, supported by investments in digital train control, network resilience, and disciplined capital spending across its North American freight corridors.
    • At the same time, investors are weighing how evolving trade talks and a proposed Union Pacific–Norfolk Southern merger could reshape CN’s freight flows and competitive position in intermodal and bulk markets.
    • With that backdrop, we’ll now examine how CN’s efficiency focus and network investments may influence its existing investment narrative for long-term investors.

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    Canadian National Railway Investment Narrative Recap

    To own Canadian National Railway, you generally need to believe that its North American franchise, efficiency focus, and disciplined capital spending can translate into resilient earnings and cash flows over time. The key near term catalyst remains management’s drive to convert recent operational gains into consistent profit growth, while the biggest current risk is how trade negotiations and the proposed Union Pacific–Norfolk Southern merger could alter freight routing; the latest news does not yet materially change that risk profile.

    Among recent announcements, CN’s broad capex program across Canadian provinces and several U.S. states looks most relevant. These investments in track, yards, and digital control systems support the efficiency and capacity story that underpins the investment case, but they also raise the bar on CN to prove that higher spending and network upgrades can offset potential volume pressures if trade flows or competitive dynamics shift.

    Yet while CN’s network investments appear encouraging, investors should still be aware of how shifting supply chains and potential freight diversion could...

    Read the full narrative on Canadian National Railway (it's free!)

    Canadian National Railway’s narrative projects CA$19.6 billion revenue and CA$5.6 billion earnings by 2028. This requires 4.6% yearly revenue growth and about a CA$1.0 billion earnings increase from CA$4.6 billion today.

    Uncover how Canadian National Railway's forecasts yield a CA$154.85 fair value, a 12% upside to its current price.

    Exploring Other Perspectives

    TSX:CNR 1-Year Stock Price Chart
    TSX:CNR 1-Year Stock Price Chart

    Eleven members of the Simply Wall St Community currently see CN’s fair value between C$119.59 and C$154.85, underscoring how far individual views can spread. Against that backdrop, the unresolved risk that trade and routing changes could structurally divert volumes away from CN’s key corridors is something you may want to weigh carefully as you compare these different perspectives.

    Explore 11 other fair value estimates on Canadian National Railway - why the stock might be worth as much as 12% more than the current price!

    Build Your Own Canadian National Railway Narrative

    Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.