DCF Tool

CNI

Canadian National Railway Co. – Line-Haul Railroads
Canadian National Railway Company (CN) is a world-class transportation leader and trade-enabler. Essential to the economy, to the customers, and to the communities it serves, CN safely transports more than 300 million tons of natural resources, manufactured products, and finished goods throughout North America every year. As the only railroad connecting Canada's Eastern and Western coasts with the U.S. South through a 19,500-mile rail network, CN and its affiliates have been contributing to community prosperity and sustainable trade since 1919. CN is committed to programs supporting social responsibility and environmental stewardship.
Analysis Results
Intrinsic Value $87.73
Latest Price $111.62
Relative Value 27% overvalued
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Cash Flow (Billions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 7.3%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 6.9%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 7.3%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (billion) Present value (billion)
2022 2.62 2.45
2023 2.81 2.46
2024 3.01 2.46
2025 3.23 2.47
2026 3.46 2.48
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 72.2 billion. This corresponds to a present value of 48.4 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 12.3 billion. Adding in the terminal value gives a total present value of 60.7 billion.

There are presently 692.0 million outstanding shares, so the intrinsic value per share is 87.73.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 5,382,091,585
Current Cash 1,316,460,230
Current Liabilities 4,901,379,377
Current Debt 798,045,103
Non-Cash Working Capital (NCWC) -37,702,918
Change in NCWC -170,328,600
EBIT 8,739,222,267
Tax Provision 2,263,746,052
Depreciation and Amortization 2,510,385,975
Capital Expenditure -4,541,630,698
Unlevered Free Cash Flow 4,549,141,240
Current Assets 2,434,348,325
Current Cash 446,532,623
Current Liabilities 2,569,328,309
Current Debt 714,138,290
Non-Cash Working Capital (NCWC) 132,625,682
Change in NCWC -180,852,259
EBIT 4,130,230,572
Tax Provision 770,641,539
Depreciation and Amortization 1,246,995,322
Capital Expenditure -2,246,788,928
Unlevered Free Cash Flow 2,057,004,068
Current Assets 2,169,052,752
Current Cash 49,052,783
Current Liabilities 3,285,770,017
Current Debt 1,479,247,990
Non-Cash Working Capital (NCWC) 313,477,941
Change in NCWC 206,371,110
EBIT 4,286,753,372
Tax Provision 929,703,529
Depreciation and Amortization 1,197,194,487
Capital Expenditure -2,962,328,228
Unlevered Free Cash Flow 1,770,202,596
Current Assets 2,001,283,814
Current Cash 195,139,844
Current Liabilities 2,567,629,527
Current Debt 868,592,388
Non-Cash Working Capital (NCWC) 107,106,831
Change in NCWC -65,588,254
EBIT 4,029,711,141
Tax Provision 993,305,823
Depreciation and Amortization 974,965,612
Capital Expenditure -2,590,371,389
Unlevered Free Cash Flow 1,388,451,554
Current Assets 1,742,867,463
Current Cash 55,708,092
Current Liabilities 3,169,790,460
Current Debt 1,655,326,175
Non-Cash Working Capital (NCWC) 172,695,086
Change in NCWC -132,947,415
EBIT 4,423,222,540
Tax Provision -314,352,807
Depreciation and Amortization 1,019,458,091
Capital Expenditure -2,127,253,301
Unlevered Free Cash Flow 3,182,479,915
Current Assets 1,563,079,496
Current Cash 130,565,729
Current Liabilities 2,231,487,007
Current Debt 1,104,615,742
Non-Cash Working Capital (NCWC) 305,642,502
Change in NCWC -14,514,797
EBIT 3,940,711,097
Tax Provision 954,761,894
Depreciation and Amortization 908,767,148
Capital Expenditure -1,999,287,727
Unlevered Free Cash Flow 1,806,307,914
Current Assets 1,552,474,475
Current Cash 110,324,475
Current Liabilities 2,161,782,850
Current Debt 1,039,790,150
Non-Cash Working Capital (NCWC) 320,157,300
Change in NCWC 13,165,146
EBIT 3,797,180,950
Tax Provision 963,356,200
Depreciation and Amortization 835,004,850
Capital Expenditure -1,951,228,950
Unlevered Free Cash Flow 1,653,286,183

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