Canadian National Railway…
Thanks so much for checking in.
It is a well known fact that the rails have been attracting the attention of some premium investors. As you probably know, Burlington Northern was recently acquired, in full, by Berkshire Hathaway.
The rails are essential to any prolonged economic recovery. They have always been well ahead of their time… modular; and far superior to trucks in terms of fuel efficiency. Indeed, as the price of oil rises, the rails become more valuable.
What you might not know, however, is that Canadian National Railway, ticker CNI, is the most profitable rail in North America. It averages 12% ROIC compared to 7.5% ROIC for Union Pacific, and 8.4%ROIC for CSX Corp. That is a huge difference in terms of profitability… especially over the long haul.
That said, I feel that CNI stock is not cheap. I wold need a sizable pullback to aggressively buy the stock. By sizeable, I’m talking a 10-15% downside correction. Like I’ve said before, I refuse to chase returns… and if I can’t get my desired price, I’m not interested.
When it comes to investing in the rails, CNI appears to be an excellent option. A nice pullback would make it even better.
I hope you are having a great day.
Peace. JBFull disclosure: This blog and website are for informational, educational, and discussion purposes only. I am not a registered advisor, broker, dealer, or otherwise holding myself out to be a financial expert. In writing this Blog, I am only stating my opinion, which may change over time, as does the market and the conditions which affect it. I do not intend to cause harm of any kind by writing this Blog and do not guarantee the absolute accuracy of the contents within it. By writing this Blog, I do not offer advice of any kind as it relates to a potential course of action by readers involving the sale or purchase of stocks or any other security. I encourage you to consult with your financial advisor or other experts before making such decisions. Therefore, you, the reader, hereby agree not to hold JB’s Financial Blog, or any of its writers, liable for any action which you may choose to take or fail to take based strictly upon information contained within this Blog. I am in no way responsible for the comments which other readers may make, nor the content of websites found via outbound or inbound links to this site, as I have no control over the contents thereof. I look forward to your input and feedback. Peace. JB © 2010, JB’s Financial Blog. All rights reserved. Unauthorized use of JB’s Financial Blog’s material may violate multiple legal rights of JB’s Financial Blog. All of JB’s Financial Blog’s material and information provided herein is fully protected under the United States Copyright Laws, 17 U.S.C. §§ 101 et seq., and unauthorized copying of, or quoting from, our materials without express written permission is strictly prohibited. JB