Canadian National Railway Company Fundamental Analysis
Canadian National Railway Company (CNI) shows moderate financial fundamentals with a PE ratio of 21.60, profit margin of 27.22%, and ROE of 21.93%. The company generates $17.2B in annual revenue with N/A year-over-year growth of N/A.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 70.8/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze CNI's fundamental strength across five key dimensions:
Efficiency Score
WeakCNI struggles to generate sufficient returns from assets.
Valuation Score
ModerateCNI shows balanced valuation metrics.
Growth Score
ModerateCNI shows steady but slowing expansion.
Financial Health Score
WeakCNI carries high financial risk with limited liquidity.
Profitability Score
ExcellentCNI achieves industry-leading margins.
Key Financial Metrics
Is CNI Expensive or Cheap?
P/E Ratio
CNI trades at 21.60 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, CNI's PEG of 2.35 indicates potential overvaluation.
Price to Book
The market values Canadian National Railway Company at 4.73 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 8.73 times EBITDA. This is generally considered low.
How Well Does CNI Make Money?
Net Profit Margin
For every $100 in sales, Canadian National Railway Company keeps $27.22 as profit after all expenses.
Operating Margin
Core operations generate 37.75 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $21.93 in profit for every $100 of shareholder equity.
ROA
Canadian National Railway Company generates $7.90 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Canadian National Railway Company generates strong operating cash flow of $7.10B, reflecting robust business health.
Free Cash Flow
Canadian National Railway Company generates strong free cash flow of $3.55B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $5.85 in free cash annually.
FCF Yield
CNI converts 3.55% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
21.60
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
2.35
vs 25 benchmark
P/B Ratio
Price to book value ratio
4.73
vs 25 benchmark
P/S Ratio
Price to sales ratio
5.83
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.05
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.67
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.22
vs 25 benchmark
ROA
Return on assets percentage
0.08
vs 25 benchmark
ROCE
Return on capital employed
0.12
vs 25 benchmark
How CNI Stacks Against Its Sector Peers
| Metric | CNI Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 21.60 | 26.21 | Better (Cheaper) |
| ROE | 21.93% | 1254.00% | Weak |
| Net Margin | 27.22% | -35113.00% (disorted) | Strong |
| Debt/Equity | 1.05 | 0.74 | Weak (High Leverage) |
| Current Ratio | 0.67 | 9.96 | Weak Liquidity |
| ROA | 7.90% | -1487045.00% (disorted) | Weak |
CNI outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Canadian National Railway Company's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
N/A
Industry Style: Cyclical, Value, Infrastructure
EPS CAGR
N/A
Industry Style: Cyclical, Value, Infrastructure
FCF CAGR
N/A
Industry Style: Cyclical, Value, Infrastructure