Canadian National Railway Company
) - the largest rail network in Canada - is set to release its
second-quarter 2013 results before the opening bell on Jul 22,
In the last quarter, the company delivered a 1.67% negative
earnings surprise. Let's see how things are shaping up for this
Factors to be Considered this Quarter
Despite the economic slowdown, we expect Canadian National
Railway to benefit from strong growth of favorable demand/supply
dynamics. The company has also planned investments for
infrastructural development along with dividend payouts and share
buybacks. However, weakness in some of the product lines along
with estimated high expenses indicate that the company will
perform at par with the broader market and keep us sidelined.
Our proven model does not conclusively show that Canadian
National Railway is likely to beat the Zacks Consensus Estimate
this quarter. This is because a stock needs to have both a
positive Expected Surprise Prediction (ESP) (Read: Zacks Earnings
ESP: A Better Method) and a Zacks Rank #1 (Strong Buy), #2 (Buy)
or #3 (Hold) for this to happen. Unfortunately, this is not the
case here as elaborated below.
Negative Zacks ESP: This is because the Most Accurate Estimate is
$1.57 while the Zacks Consensus Estimate is higher at $1.58. This
leads to an ESP of -0.63% for Canadian National Railway.
Zacks Rank #3 (Hold): Canadian National Railway's Zacks Rank #3,
decreases the predictive power of ESP.
We caution investors against the stock going into the earnings
announcement, as a Zacks Earnings ESP of -0.63% combined with a
Zacks Rank # 3 lowers the possibility of an earnings surprise.
Other Stocks to Consider
Here are some other companies to consider as our model shows they
have the right combination of elements to post an earnings beat
CELADON GROUP (CGI): Free Stock Analysis
CDN NATL RY CO (CNI): Free Stock Analysis
EXPEDITORS INTL (EXPD): Free Stock Analysis
WABTECH (WAB): Free Stock Analysis Report
To read this article on Zacks.com click here.
Westinghouse Air Brake Technologies Corporation
) has an Earnings ESP of +2.74% and carries a Zacks Rank #2
Celadon Group Inc.
) has an Earnings ESP of +3.33% and carries a Zacks Rank #2
Expeditors International of Washington Inc.
) has an Earnings ESP of +2.33% and carries a Zacks Rank #3