Q: Hi, all
Not loving the ride I'm taking with CP these days. I think you prefer CN, which I also own.
I can stay in my seat with CP for diversification sake or switch and stick with CN.
Your general thoughts on the two?
Thanks,
Robert
Not loving the ride I'm taking with CP these days. I think you prefer CN, which I also own.
I can stay in my seat with CP for diversification sake or switch and stick with CN.
Your general thoughts on the two?
Thanks,
Robert
5i Research Answer:
We like both quite a lot. In the past 18 months we were generally a bit more positive on CNR, primarily because CP needed to digest its very large KC acquisition. CP is now cheaper than CNR on valuation (21X vs 24X). CNR has outperformed over one year and has a higher dividend yield currently (2% vs 0.72%). Today with the valuation difference we would largely be indifferent. If both are owned, we think keeping them for diversification makes sense.