This Top Canadian Railway Stock Is Trading Around Its 5-Year Low

Investing in railways can be a good way to invest in a country’s long-term growth. While there are high costs and maintenance and disruptions which can impact its operations in the short term, a railway operator should generally experience solid growth over longer periods, as the economy grows. And thus, investing in one, even amid economic uncertainty, may be a move that can pay off significantly in the future.

Canadian National Railway Company (TSX:CNR)(NYSE:CNI) is an excellent example of that. Uncertainty around tariffs have weighed on the stock, whose shares are down 17% in the past year. It’s not only trading near its 52-week low, but the stock also hasn’t been this cheap in multiple years, as it hovers around its five-year lows. It’s currently trading at a fairly reasonable 18 times its trailing earnings, and it can make for a good value buy.

The company released its latest earnings numbers on July 22 and they weren’t too bad with revenue down by just 1%, totaling $4.3 billion in the most recent quarter. And its adjusted operating income was flat. The business has been focusing on keeping its costs down to navigate what it calls a “challenging external environment.”

While the short term may indeed be challenging, investing in Canadian National Railway at a time when the market is bearish on the stock could set you up for some great returns down the road. And a great incentive to simply hang on and wait is that the stock offers a solid dividend that yields 2.7%.

It may take some time for this railway stock to recover, but now may be a great time to invest in it.