Canadian National At 52-Week High: What's Driving It?
Zacks Investment Research | Jun 28, 2017 09:36PM ET
Shares of Canadian National Railway Company (NYSE:CNI) hit a 52-week high of $82.65 during the course of the trading session on Jun 28, before retracing a bit to close the session at $82.55.
The company’s first-quarter 2017 coal revenues improved a massive 39% year over year. This seems to be the prime reason for the upside. The increase in revenues was witnessed across most segments. Overall, volumes rose 9%.
Efforts to reward shareholders through dividend payments and share buybacks are impressive as well. The latest hike was announced in Jan 2017, when the company’s board of directors had approved a generous 10% hike in its quarterly cash dividend to 41.25 cents per share (annualized C$1.65). The improved earnings per share guidance for full-year 2017 is also a positive.
The company’s announcement of $2.6 billion capital plan in Apr 2017 is also a huge positive. Of the total, C$1.6 billion will be invested in track infrastructure. The balance is expected to be spent on buying 22 high-horsepower locomotives and other growth oriented projects.
In Apr 2017, the company received good news on the labor front, when the International Brotherhood of Electrical Workers (IBEW) ratified a five-year collective labor deal. The union represents the signals and communications employees in Canada.
Owing to these tailwinds, shares of the company have outperformed the Zacks categorized Original post
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