TD Securities raised its price target on Canadian National Railway Co. (CNR.TO, CNI) to $168 from $164, and on Canadian Pacific Kansas City Ltd. (CP.TO) to $117 from $115.
Analyst Cherilyn Radbourne maintained a Buy rating on CNR and a Hold rating on CPKC.
"The US rails face difficult PY comps in international intermodal in H2/25, Radbourne said in a note to clients. "Conversely, CN and CPKC will be lapping rail/port labour disruption."
"CN has the potential to benefit more versus CPKC, based on the opportunity to regain US-bound international intermodal traffic," the analyst said.
"Assuming that CN delivers on its 2025 guidance, the stock's unusual valuation discount versus CPKC/the group looks unsustainable, Radbourne said.
"If CN delivers on 2025 guidance, it should at least close the unusual discount; if not, we could see activism return. CPKC's relative/absolute valuation seems full given stalled investment in Mexico and increasing political/regulatory risk in Mexico."
(MT Newswires covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www.mtnewswires.com/contact-us)
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