Canadian National Railway reported adjusted earnings per share of C$2.08 for the fourth quarter of 2025, narrowly surpassing analyst estimates. Revenue growth resumed during the quarter, driven by a 1.5% increase in merchandise ton-miles, but gains were offset by an unfavorable traffic mix that weighed on overall yield. Management issued guidance for fiscal 2026 forecasting flat revenue ton-miles growth and a continued negative mix shift, while warning that rising labor and maintenance costs will create headwinds to margin expansion. The board approved a quarterly dividend increase of 3%, signaling confidence in cash flow stability despite mixed volume trends and limited near-term earnings upside.

Canada Packers, which spun off from its parent company in late 2025, is trading at a valuation consistent with a mid-cycle multiple despite a forecasted 6% dividend yield. The company’s clean balance sheet carries net debt of C$150 million against annualized EBITDA of C$120 million and free cash flow conversion above 90%. Geographic diversification across Western Canada and strategic premiumization initiatives in Japan have the potential to boost EBITDA margins by 50 to 150 basis points over the next two years. With pork production volumes projected to stabilize at 400,000 metric tonnes in fiscal 2026, investors may find the security’s risk-adjusted return profile attractive given the combination of yield, cash generation and margin upside potential.