Canadian National R.R. (CNR.TO)

Positive with a long term uptrend, then a consolidation, then another uptrend started in mid-2018. It continues to make new all-time highs. Sees no reason to sell. Weakness at the $110 level, if you want to add.

The Port of Prince Rupert is the fastest growing port in North America. This is the best way to come from Asia to North America. In addition, grain is coming into Prince Rupert to fill the empty containers for the trip back. The only railroad servicing Prince Rupert is CN. So even though tariffs are having an impact, CN is a big winner here.

CP vs. CNR? Lots to like about the rails, fuel efficient, easier to go to electric rail. Long-term, likes trains. Right now, locomotive shortage affecting both companies. Today, he’d buy CP over CNR. Both a bit cyclical, but if you’re patient and diversified, CP is the one you want to own.

(A Top Pick August 28/17 - Up 5%.) Covered call selling JAN 100 calls. They were called away.

High barriers to entry. Pricing power. Rational competition. Yield 1.6%. not paying a lot for it. They are solving the customer service problems they had. (Analysts’ price target is $111.28)

(Past Top Pick on August 30, 2017, Up 12%) It's a great proxy on the Canadian economy with access to all the major shores. It quiet sneaked up to new highs after languishing a bit. Still the premier rail operator. Good management.

What will be the impact of the trade war and tariffs on Canadian rails? He doesn't know, but wouldn't worry too much. Note that in the past month CNR has gone up while CP has gone down. CP may be more impacted, but it's also dealt with a strike. He prefers CNR and still likes it. They have the Chicago Advantage with their line running through Chicago without getting stuck in that huge hub. CNR is a great proxy on the Canadian economy.

Wait for a pullback because the stock just popped higher, perhaps because of an analyst upgrade yesterday. This might be the wrong day to buy. She owns CN rather than CP. CN had some problems and it replaced its CEO last year. This seems to be working out well. CN needed to expand, because of increasing demand, and is now expanding. This is a play on the economy because they transport a broad base of goods. For both CN and CP they are benefiting from the lack of takeaway capacity for oil in the West. They are being disciplined requiring long-term contracts.

CNR-T/CP-T and Tariffs. It is very early to judge this. Automotive is a small percent of their business. Intermodal is a bigger issue. He thinks companies that move goods around the world will go down if we are in a period of protracted trade wars.

CN Rail versus CP. He does not see the tariff war directly impacting the rail companies. CN (CNR-T) is a little more exposed to cross-border trade, however. CN is a core holding in his portfolio. He does not hold CP. He would not add to his position, rather would continue to hold.

He does not see the tariff war directly impacting the rail companies. CN (CNR-T) is a little more exposed to cross-border trade, however. CN is a core holding in his portfolio. He does not hold CP. He would not add to his position, rather would continue to hold.

It is a long term hold. Around $110 there is a lot of technical resistance so you could take some money off the table short term. A global recession would bring the stock down.

Rails in general are benefiting from strong economy in North America, especially the US. All these companies have become more efficient, infrastructure plays. Trade wars are a risk. Generally, the rails are a good way to play North American economy.

There is a concern that CNR grew volumes a lot in 2017, but now they have trouble moving volumes and with customer service now. Buy it and hold. They have pricing power and growth. This is a long-term hold. This trades at slight premium to CP. Overall, a fine company.

His entry point was $100. Industrials are a way to play mid-America, like grain and cars. There's only a modest upside now of 5% plus dividend at today's $109 share price.