We recently published a list of 10 Best Railroad Stocks To Buy Now. In this article, we are going to take a look at where Canadian National Railway Company (NYSE:CNI) stands against other best railroad stocks to buy now.

In February, the Association of American Railroads reported that intermodal volumes remained robust, rising 6.4% year-over-year. Weekly originations hit an all-time high in February, averaging 276,654 units. This growth was fueled by steady consumer spending and some importers ordering extra shipments ahead of possible tariffs. So far in 2025, intermodal volume is up 8.5%, and container volume has jumped 9.5%, setting a new record for this period. Moving forward, intermodal growth will depend on consumer demand, which is closely tied to job market strength and potential trade policy shifts.

However, American railroads experienced a 4.5% drop in carloads, moving 843,618 units in February. In the last five months, January had the first increase in carloads, but harsh winter weather, including flooding in the Northeast and freezing temperatures across most of the country, interrupted operations and obstructed freight handling. Without these weather challenges, rail volumes likely would have been higher. Coal being the largest commodity moved by rail continued its downward trend, with carloads dropping 8.2% in February and marking the 14th consecutive month of declines.

As the US ramps up its trade war under President Trump, freight railroads are preparing for the fallout. New tariffs on Mexico, Canada, China, and the EU are set to take effect soon, potentially disrupting a massive trade network. In 2024, American railroads handled $203.1 billion in cross-border trade with Canada and Mexico, being almost evenly split between the two, as reported by CNBC. The rail industry is a huge economic driver, generating $233.4 billion in output and supporting around 750,000 jobs in 2023. Texas is a major hub for freight rail employment since it handles most of the US to Mexico rail traffic. Railroads also reinvested $26.8 billion in infrastructure last year, mostly through private funding. As trade tensions rise, the industry remains focused on keeping goods moving and ensuring rail infrastructure stays strong.

Our Methodology 

For this article, we focused on making a list of all railroad and railcar stocks that are publicly listed in the United States. Using Insider Monkey’s Q4 2024 hedge fund database, we examined the hedge fund sentiment for each stock and selected 10 most popular ones. The stocks are ranked in ascending order based on the number of hedge fund holders as of Q4 2024.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

A driverless train traversing vast countryside, illustrating the companies long-distance rail transport services.

Canadian National Railway Company (NYSE:CNI)

Number of Hedge Fund Holders: 56

Canadian National Railway Company (NYSE:CNI) is a major player in the transportation and logistics industry, operating across Canada and the United States. Its services include rail transportation, intermodal solutions, trucking, and marine transport. CNI and Iowa Northern Railway officially merged operations on March 1, 2025, after getting the green light from US regulators. This merger is meant to improve service, open up new market opportunities, and boost the local economy.

In the fourth quarter of 2024, Canadian National Railway Company (NYSE:CNI)’s revenue ton miles dropped 3% year-over-year to 59,305 million. Revenues fell by C$113 million year-over-year to C$4,358 million in Q4, while operating income dropped by C$190 million to C$1,628 million. However, by December 2024, the company had repurchased over 13 million shares for more than $2.3 billion. CNI also declared a 5% dividend increase for 2025, continuing a 29-year streak of growth, and authorized another buyback program for up to 20 million shares from February 2025 to February 2026.

According to Insider Monkey’s Q4 data, Canadian National Railway Company (NYSE:CNI) was part of 56 hedge fund portfolios, compared to 44 in the last quarter. Bill & Melinda Gates Foundation Trust was the largest investor in the company, with a position worth over $5.5 billion.

Overall, CNI ranks 6th on our list of best railroad stocks to buy now. While we acknowledge the potential of CNI to grow, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CNI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.