Canadian National Railway Co. has received an analyst upgrade from BMO Capital Markets amid high consumer demand for goods.
In a note to clients Wednesday, analyst Fadi Chamoun said CN’s shipping volumes have been stronger than expected.
He raised his recommendation on the rail operator to outperform (the equivalent of a buy) from a market perform rating (the equivalent of hold). He maintained his 12-month price target at $170.00 per share, implying a roughly 15 per cent gain from where the stock is currently trading.
However, he said he sees a scenario where CN’s stock price could rise to $190-$200 per share if “the demand environment remains favourable.”
Chamoun added that even if consumer demand softens, the potential downside for the stock price and CN’s earnings power is limited because it’s implementing a number of measures to improve its efficiency.
