AnalystConsensusTarget updated the narrative for CNR

Analysts have revised Canadian National Railway's fair value price target down by approximately $1.43 CAD to $151.33. This change is attributed to modest reductions in the revenue growth outlook and a slight increase in discount rates, despite improved profit margin projections.

Analyst Commentary

Following the recent downward adjustment to Canadian National Railway's fair value price target, analysts have provided insights into the company's outlook. Their perspectives address both the optimistic factors supporting the stock and the concerns weighing on its valuation and growth trajectory.

Bullish Takeaways

• Bullish analysts point to the company's improved profit margin projections as a sign of effective cost management and operational efficiency.
• The ongoing diversification of service offerings is expected to provide a stable foundation for long-term growth, supporting the updated price target despite lower revenue expectations.
• Positive sentiment remains around Canadian National Railway's ability to generate shareholder value through strategic investments and prudent capital allocation.
• Analysts remain confident that the company’s scale and market position bolster its resilience in changing economic conditions. This may help offset near-term headwinds.

Bearish Takeaways

• Bearish analysts highlight that modest reductions to revenue growth outlook could place pressure on future earnings and limit upside potential.
• A slight increase in discount rates has tempered the company’s intrinsic valuation. This indicates increased risk or uncertainty in the broader market.
• Concerns persist about the impact of macroeconomic factors, such as fluctuating commodity demand and potential regulatory challenges, on Canadian National Railway’s core business.

What's in the News

• CN and CSX signed a Memorandum of Understanding to launch a new intermodal service into Nashville, Tennessee. The partnership will offer a faster and more sustainable all-rail alternative for international containers moving from Canada’s West Coast through Memphis into Nashville (Client Announcements).
• Canadian National Railway expanded its wildfire response capabilities by introducing two specialized firefighting railcars and launching a pilot program for fire trailers. Additional large tank cars have been stationed in British Columbia to support firefighting efforts in water-scarce regions (Business Expansions).
• The company completed a repurchase of 2,200,000 shares for CAD 300 million between April and June 2025, fulfilling the buyback plan announced earlier in the year (Buyback Tranche Update).

Valuation Changes

• The consensus analyst price target has decreased slightly from CA$152.76 to CA$151.33.
• The discount rate has risen modestly from 7.49% to 7.53%.
• The revenue growth expectation has dipped marginally from 4.59% to 4.48%.
• The net profit margin projection has increased from 28.61% to 28.91%.
• The future P/E ratio estimate has declined subtly from 20.63x to 20.31x.