# Canadian National Railway (CNR.TO)

Canonical: https://gigainvestors.com/s/CNR.TO

Analysis as of: 2026-10-16T07:33:47.001Z. Financial observations: FY1996–FY2026.

Listing currency: CAD. Reporting currency: CAD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: CAD 171.56 per share; close as of 2026-10-15.

Estimated value: low CAD 83.58 per share, central CAD 102.10 per share, high CAD 119.02 per share. Buy at or below the central value CAD 102.10 per share. Valuation as of 2026-10-16T07:33:47.001Z; scenarios are not confidence intervals.

Expected annual return: 7.2% at the stated quote. About 7.2% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; CA 10-year bond 3.8% + 4 points).

## Checklist

### understandable: pass

- 2 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 2

- Years with a net loss: 0

- Operating margin variation: 0.04×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.40×

- FY2018: 0.38×

- FY2019: 0.37×

- FY2020: 0.35×

- FY2021: 0.39×

- FY2022: 0.40×

- FY2023: 0.39×

- FY2024: 0.37×

- FY2025: 0.38×

- LTM to Jun 2026: 0.38×

### moat: fail

- ROIC median below threshold

- Recent gross margin fell 8.7pp below the typical margin (limit 4pp)

- ROIC, median of available years: 13.7%

- ROIC, second-lowest year: 11.6%

- Typical minus recent gross margin: 8.7 pp

- Typical gross margin (annual median): 53.3%

- Recent gross margin (lower of latest and 3-year median): 44.6%

- Years with nonpositive capital: 0

- Capital spending / revenue: 20.8%

- ROIC including acquisitions, ten-year median: 10.6%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 14.7%

- FY2017: 19.3%

- FY2018: 14.0%

- FY2019: 13.5%

- FY2020: 11.6%

- FY2021: 12.5%

- FY2022: 14.0%

- FY2023: 14.9%

- FY2024: 11.5%

- FY2025: 11.6%

### economics: fail

- incremental invested capital return below threshold

- Owner earnings / net income, 5-yr: 0.85×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: CAD 21B

- Net income, five-year total: CAD 25B

- Return on incremental invested capital: 8.2%

- Working capital / revenue, annual change: -0.6 pp

- Working capital / revenue, change between three-year averages: -3.4 pp

- Working capital / revenue, final three-year average: 2.2%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 0.98×

- FY2022: 0.99×

- FY2023: 0.74×

- FY2024: 0.74×

- FY2025: 0.77×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- potential debt-funded buybacks (informational)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 14.7% vs 11.6%

- Per-share earnings: 4.73 to 7.66 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: -2.5%

- Ordinary dilution, 5-year annual growth: -2.9%

- Market cap gain: CAD 14B

- Cumulative retained earnings: CAD 5.7B

- Diluted shares, 10-year annual growth: -2.5%

- Diluted shares, 5-year annual growth: -2.9%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 6.2%

- Per-share value change: CAD 2.94

- Per-share value, starting three-year median: CAD 4.73

- Per-share value, ending three-year median: CAD 7.66

- Buybacks concentrated in cheaper years (correlation): 0.26

- Average buyback yield: 2.6%

- Buyback history: 10 years

- Debt-funded buybacks: Yes

- Acquisition spending: CAD 625M

- Cumulative net income, 10 years: CAD 46B

- ROIC, first three-year median: 14.7%

- ROIC, last three-year median: 11.6%

Chart: Earnings per share; fiscal year observations.

- FY2016: CAD 4.73

- FY2017: CAD 7.31

- FY2018: CAD 5.92

- FY2019: CAD 5.88

- FY2020: CAD 4.97

- FY2021: CAD 6.93

- FY2022: CAD 7.56

- FY2023: CAD 8.69

- FY2024: CAD 7.07

- FY2025: CAD 7.66

### accounting: pass

- Sloan accruals: -4.0%

- Receivables to sales index (DSRI): 0.84×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.49×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.03×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -4.2%

- FY2017: -0.1%

- FY2018: -3.9%

- FY2019: -3.9%

- FY2020: -5.8%

- FY2021: -4.3%

- FY2022: -3.1%

- FY2023: -2.5%

- FY2024: -3.9%

- FY2025: -4.0%

## Holders

- [Prem Watsa](https://gigainvestors.com/FFH): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Bill Gates](https://gigainvestors.com/GFT): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Thomas Gayner](https://gigainvestors.com/MKL): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Lee Ainslie](https://gigainvestors.com/mc): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Chris Hohn](https://gigainvestors.com/tci): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Price needs cash profits to grow 9.2% a year for ten years · "CN boosts outlook as volume growth tops expectations" (finance.yahoo.com, Jul 2026) · sales +2.6%

Story as of 2026-10-16T09:59:57.724Z; price observation 2026-10-15.

Price needs cash profits to grow 9.2% a year for ten years

- 2025-05-22: Canadian National Railway’s surge in car velocity signals margin upside - CIBC ([finance.yahoo.com](https://finance.yahoo.com/news/canadian-national-railway-surge-car-152806609.html))

- 2025-07-22: Canadian National Railway Lowers 2025 Outlook Amid Tariff Uncertainty ([finance.yahoo.com](https://finance.yahoo.com/m/eb3e68a2-8180-39bf-881d-7ab166b0bb60/canadian-national-railway.html))

- 2026-02-23: CIBC Says Canadian Grain, Potash Outlook Supportive for CN, CPKC ([finance.yahoo.com](https://finance.yahoo.com/news/cibc-says-canadian-grain-potash-164552412.html))

- 2026-05-24: Canadian National Railway Eyes Export Growth With Alberta Energy Rail Project ([finance.yahoo.com](https://finance.yahoo.com/sectors/energy/articles/canadian-national-railway-eyes-export-010648253.html))

- 2026-06-05: CNI Hits New Propane Shipment Record, Reflecting Strong Export Demand ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/cni-hits-propane-shipment-record-174200417.html))

- 2026-07-27: Canadian National Q2 Earnings Beat on Grain and Energy Volume Growth ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/canadian-national-q2-earnings-beat-170200872.html))

### Sales · FY2025–2026

sales +2.6%; source https://www.sec.gov/Archives/edgar/data/16868/000110465926010352/tm261145d1_40f.htm; observed 2026-02-04.

- FY2017: CAD 13B 

- FY2018: CAD 14B 

- FY2019: CAD 15B 

- FY2020: CAD 14B 

- FY2021: CAD 14B 

- FY2022: CAD 17B 

- FY2023: CAD 17B 

- FY2024: CAD 17B 

- FY2025: CAD 17B 

- FY2026: CAD 18B 

### Gross margin · FY2025

gross margin 44.9%; source https://www.sec.gov/Archives/edgar/data/16868/000110465926010352/tm261145d1_40f.htm; observed 2026-02-04.

- FY2016: 57.3% 

- FY2017: 55.8% 

- FY2018: 53.0% 

- FY2019: 53.6% 

- FY2020: 55.4% 

- FY2021: 56.0% 

- FY2022: 45.2% 

- FY2023: 44.6% 

- FY2024: 43.2% 

- FY2025: 44.9% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in railroads; annual sales are CAD 17.3 billion.

- Source: https://www.sec.gov/Archives/edgar/data/16868/000110465926010352/tm261145d1_40f.htm (filed 2026-02-04); FY2025: revenue 17304000000; grossProfit 7764000000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); CNR.TO: Canadian National Railway Company, together with its subsidiaries, engages in the rail, intermodal, trucking, and related transportation businesses in Canada and the United States. The company provides rail services, which include equipment, customs brokerage, transloading and warehousing, business development, dimensional loads, and private railcar storage, less-than-truckload, and mexico services; intermodal services, such as temperature controlled multimodal, mobile transport trays, port partnerships, transloading and distribution, logistics parks, trucking, and supply chain services. It also offers connecting to rail, short lines, maps and network services. The company serves automotive, coal, fertilizers, temperature controlled cargo, forest products, dimensional, grain, metal and minerals, petroleum and chemicals, consumer goods, and third party logistics applications. Canadian National Railway Company was incorporated in 1919 and is headquartered in Montreal, Canada.

### Why customers stay

Margins ranged from 43.2% to 44.9% during 2023–25; it earns 13.7% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2023: grossProfit / revenue = 44.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2024: grossProfit / revenue = 43.2%.

- Source: https://www.sec.gov/Archives/edgar/data/16868/000110465926010352/tm261145d1_40f.htm (filed 2026-02-04); FY2025: grossProfit / revenue = 44.9%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); 10-year return on capital observations [[2016,0.14691999299883104],[2017,0.1930889761588699],[2018,0.1397287608463641],[2019,0.13489944791148142],[2020,0.11583790050740177],[2021,0.1248363305404496],[2022,0.14035061103824764],[2023,0.1487129845859679],[2024,0.11456839037682859],[2025,0.11558075632586591]]; median 0.13731410437892277. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Spends 19.7% of cash earnings on expansion; earns 8.2% on new investment.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2016: growth capex 0; upkeep 2695000000; owner earnings 2170000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2017: growth capex 1392000000; upkeep 1281000000; owner earnings 5484000000. Growth capex / owner earnings = 0.2538293216630197.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2018: growth capex 2202000000; upkeep 1329000000; owner earnings 4328000000. Growth capex / owner earnings = 0.5087800369685767.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2019: growth capex 1590681376.7674065; upkeep 2274318623.2325935; owner earnings 3403481376.7674065. Growth capex / owner earnings = 0.46736890867850733.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2020: growth capex 0; upkeep 2863000000; owner earnings 2208800000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2021: growth capex 1293000000; upkeep 1598000000; owner earnings 4813000000. Growth capex / owner earnings = 0.26864741325576563.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2022: growth capex 1021000000; upkeep 1729000000; owner earnings 5049800000. Growth capex / owner earnings = 0.2021862251970375.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2023: growth capex 0; upkeep 3187000000; owner earnings 4172000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); FY2024: growth capex 605916684.096159; upkeep 2943083315.903841; owner earnings 3301516684.096159. Growth capex / owner earnings = 0.183526767262737.

- Source: https://www.sec.gov/Archives/edgar/data/16868/000110465926010352/tm261145d1_40f.htm (filed 2026-02-04); FY2025: growth capex 713722452.1688323; upkeep 2944277547.8311677; owner earnings 3628922452.1688323. Growth capex / owner earnings = 0.19667613777259824.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); Incremental return on capital 0.08195061867113454, from the economics test's unchanged annual inputs.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); Dividend observations: [[2016,1159000000],[2017,1239000000],[2018,1333000000],[2019,1544000000],[2020,1634000000],[2021,1740000000],[2022,2004000000],[2023,2071000000],[2024,2138000000],[2025,2208000000]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/16868/000110465926010352/tm261145d1_40f.htm (filed 2026-02-04); FY2025: cash repurchases 2115000000 CAD.

### Are managers owners

Insiders own <0.1% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); CNR.TO SharesStats.PercentInsiders = 0.027 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 9.2% yearly over ten years; actual growth was 3.9%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-04); Ten-year compound average after fade. Initial solved rate 0.11865256542485025. Price 171.56; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 4.001408898173329 → FY2025 5.891107876897455. Closing-price date 2026-10-15.

## Monthly share-price history (CAD per share)

- 2016-10: CAD 84.32 per share

- 2016-11: CAD 89.81 per share

- 2016-12: CAD 90.36 per share

- 2017-01: CAD 90.44 per share

- 2017-02: CAD 92.36 per share

- 2017-03: CAD 98.16 per share

- 2017-04: CAD 98.67 per share

- 2017-05: CAD 104.73 per share

- 2017-06: CAD 105.22 per share

- 2017-07: CAD 98.52 per share

- 2017-08: CAD 101.22 per share

- 2017-09: CAD 103.38 per share

- 2017-10: CAD 103.81 per share

- 2017-11: CAD 100.71 per share

- 2017-12: CAD 103.65 per share

- 2018-01: CAD 98.58 per share

- 2018-02: CAD 99.28 per share

- 2018-03: CAD 94.16 per share

- 2018-04: CAD 99.17 per share

- 2018-05: CAD 108.25 per share

- 2018-06: CAD 107.53 per share

- 2018-07: CAD 116.12 per share

- 2018-08: CAD 116.06 per share

- 2018-09: CAD 115.90 per share

- 2018-10: CAD 112.54 per share

- 2018-11: CAD 114.16 per share

- 2018-12: CAD 101.11 per share

- 2019-01: CAD 109.65 per share

- 2019-02: CAD 112.92 per share

- 2019-03: CAD 119.63 per share

- 2019-04: CAD 124.44 per share

- 2019-05: CAD 119.82 per share

- 2019-06: CAD 121.20 per share

- 2019-07: CAD 124.92 per share

- 2019-08: CAD 122.60 per share

- 2019-09: CAD 118.96 per share

- 2019-10: CAD 117.80 per share

- 2019-11: CAD 120.61 per share

- 2019-12: CAD 117.47 per share

- 2020-01: CAD 123.67 per share

- 2020-02: CAD 113.79 per share

- 2020-03: CAD 110.03 per share

- 2020-04: CAD 115.11 per share

- 2020-05: CAD 118.60 per share

- 2020-06: CAD 120.11 per share

- 2020-07: CAD 130.84 per share

- 2020-08: CAD 137.06 per share

- 2020-09: CAD 141.81 per share

- 2020-10: CAD 132.35 per share

- 2020-11: CAD 136.00 per share

- 2020-12: CAD 139.94 per share

- 2021-01: CAD 129.52 per share

- 2021-02: CAD 138.91 per share

- 2021-03: CAD 145.84 per share

- 2021-04: CAD 132.33 per share

- 2021-05: CAD 134.50 per share

- 2021-06: CAD 130.79 per share

- 2021-07: CAD 135.56 per share

- 2021-08: CAD 148.40 per share

- 2021-09: CAD 146.78 per share

- 2021-10: CAD 164.48 per share

- 2021-11: CAD 161.86 per share

- 2021-12: CAD 155.38 per share

- 2022-01: CAD 154.93 per share

- 2022-02: CAD 157.24 per share

- 2022-03: CAD 167.70 per share

- 2022-04: CAD 151.08 per share

- 2022-05: CAD 143.82 per share

- 2022-06: CAD 144.79 per share

- 2022-07: CAD 162.23 per share

- 2022-08: CAD 156.19 per share

- 2022-09: CAD 149.18 per share

- 2022-10: CAD 161.40 per share

- 2022-11: CAD 172.69 per share

- 2022-12: CAD 160.84 per share

- 2023-01: CAD 158.38 per share

- 2023-02: CAD 155.41 per share

- 2023-03: CAD 159.47 per share

- 2023-04: CAD 161.50 per share

- 2023-05: CAD 153.06 per share

- 2023-06: CAD 160.42 per share

- 2023-07: CAD 159.84 per share

- 2023-08: CAD 152.20 per share

- 2023-09: CAD 147.09 per share

- 2023-10: CAD 146.73 per share

- 2023-11: CAD 157.46 per share

- 2023-12: CAD 166.55 per share

- 2024-01: CAD 166.78 per share

- 2024-02: CAD 175.97 per share

- 2024-03: CAD 178.37 per share

- 2024-04: CAD 167.09 per share

- 2024-05: CAD 173.50 per share

- 2024-06: CAD 161.66 per share

- 2024-07: CAD 159.83 per share

- 2024-08: CAD 158.79 per share

- 2024-09: CAD 158.37 per share

- 2024-10: CAD 150.35 per share

- 2024-11: CAD 156.34 per share

- 2024-12: CAD 145.97 per share

- 2025-01: CAD 151.82 per share

- 2025-02: CAD 146.68 per share

- 2025-03: CAD 140.04 per share

- 2025-04: CAD 133.51 per share

- 2025-05: CAD 144.26 per share

- 2025-06: CAD 141.89 per share

- 2025-07: CAD 129.38 per share

- 2025-08: CAD 132.95 per share

- 2025-09: CAD 131.24 per share

- 2025-10: CAD 134.49 per share

- 2025-11: CAD 133.83 per share

- 2025-12: CAD 135.75 per share

- 2026-01: CAD 130.99 per share

- 2026-02: CAD 153.07 per share

- 2026-03: CAD 143.18 per share

- 2026-04: CAD 152.57 per share

- 2026-05: CAD 163.25 per share

- 2026-06: CAD 169.25 per share

- 2026-07: CAD 178.25 per share

- 2026-08: CAD 173.05 per share

- 2026-09: CAD 169.40 per share

- 2026-10: CAD 169.21 per share

## Annual estimated value (CAD per share)

- FY2016: low CAD 47.38 per share, central CAD 59.45 per share, high CAD 69.40 per share

- FY2017: low CAD 58.70 per share, central CAD 82.37 per share, high CAD 96.68 per share

- FY2018: low CAD 66.26 per share, central CAD 90.14 per share, high CAD 105.64 per share

- FY2019: low CAD 69.15 per share, central CAD 95.54 per share, high CAD 112.05 per share

- FY2020: low CAD 53.03 per share, central CAD 65.89 per share, high CAD 76.82 per share

- FY2021: low CAD 78.33 per share, central CAD 102.68 per share, high CAD 120.01 per share

- FY2022: low CAD 96.25 per share, central CAD 130.28 per share, high CAD 152.65 per share

- FY2023: low CAD 84.63 per share, central CAD 116.31 per share, high CAD 136.35 per share

- FY2024: low CAD 79.87 per share, central CAD 99.23 per share, high CAD 115.77 per share

- FY2025: low CAD 81.46 per share, central CAD 99.50 per share, high CAD 115.98 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:39:32.628Z where newer inputs omit a numeric field or fiscal period.

## Sources

[Original 40-F filing](https://www.sec.gov/Archives/edgar/data/16868/000110465926010352/tm261145d1_40f.htm); period 2025-12-31, filed 2026-02-04.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.