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    How Stronger Earnings And New Union Pacific Access At Canadian National Railway (TSX:CNR) Has Changed Its Investment Story

    Simply Wall St·07/26/2026 00:31:23
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    • Canadian National Railway Company recently reported higher second-quarter and first-half 2026 results, with sales rising to C$4,753 million and C$9,132 million respectively, alongside increased net income and earnings per share, while also confirming a C$0.9150 third-quarter dividend and completing C$1,075 million of share repurchases under its current buyback.
    • At the same time, a new operating agreement with Union Pacific grants Canadian National Railway fresh access between Memphis and Eagle Pass and expanded Chicago-area rights, potentially reshaping long-haul freight flows between Canada, the U.S. Midwest, and Mexico.
    • Next, we’ll examine how CN’s stronger earnings and expanded Union Pacific access may affect its investment narrative and long-term assumptions.

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    Canadian National Railway Investment Narrative Recap

    To own Canadian National Railway today, you need to be comfortable with a steady, asset-heavy business that depends on North American trade flows, disciplined pricing, and efficient operations. The latest earnings beat and the Union Pacific access deal reinforce the near term catalyst of volume and revenue growth from better network usage, while the key risk remains that any shift or slowdown in cross border freight demand could blunt the benefit of these new routes. Overall, the recent news strengthens rather than changes that core thesis.

    Among the recent announcements, the binding operating agreement with Union Pacific between Memphis and Eagle Pass looks most relevant, because it directly ties into CN’s tri coastal network story and long haul Canada U.S. Mexico corridors. If freight volumes cooperate, this added reach could help CN use its existing infrastructure more effectively, which is central to the idea that the company can turn past capital spending into better earnings and cash generation over time.

    But while the Union Pacific deal widens CN’s reach, investors should still be aware of how sensitive those new corridors are to trade policy and tariff shifts...

    Read the full narrative on Canadian National Railway (it's free!)

    Canadian National Railway's narrative projects CA$20.2 billion revenue and CA$5.7 billion earnings by 2029. This requires 5.4% yearly revenue growth and about a CA$1.0 billion earnings increase from CA$4.7 billion today.

    Uncover how Canadian National Railway's forecasts yield a CA$177.79 fair value, a 3% downside to its current price.

    Exploring Other Perspectives

    TSX:CNR 1-Year Stock Price Chart
    TSX:CNR 1-Year Stock Price Chart

    Five members of the Simply Wall St Community currently see CN’s fair value between C$132.87 and C$177.79, highlighting a wide band of expectations. Against that backdrop, CN’s new Union Pacific access and recent earnings strength give you several different ways to think about how future volumes and tariffs could influence the company’s results, so it is worth comparing these views before deciding what you believe.

    Explore 5 other fair value estimates on Canadian National Railway - why the stock might be worth as much as CA$177.79!

    Decide For Yourself

    Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.