Canadian National Railways Faces Rising Earnings Pressure And Network Challenges, Analyst Downgrades Stock

BofA Securities analyst Ken Hoexter downgraded Canadian National Railway Company (NYSE:CNI) to Neutral from Buy, lowering the price forecast from $129 to $122 amid “rising earnings pressure.”

According to the analyst, the company’s third-quarter volumes have been affected by ongoing network performance challenges following the labor lockout of Conductor/Engineer staff in August.

The analyst estimates 2024 EPS growth of -0.3%, down from a previous forecast of +2.0%, which is below Canadian National’s revised low single-digit guidance, reduced from mid-single digits last month.

Hoexter highlights that Canadian National has been grappling with months of labor uncertainty, a four-day shutdown of its Canadian network, and wildfires in Alberta.

The company’s September volumes were below expectations, showing ...

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