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Freight Rail Traffic for the Week Ended December 17

PART:
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Part 13
Freight Rail Traffic for the Week Ended December 17 PART 13 OF 15

A Look at Canadian National’s Intermodal Volumes

Canadian National’s intermodal volumes

In the week ended December 17, 2016, Canadian National Railway’s (CNI) overall intermodal volumes rose 0.7%. Its container volume rose 0.8% in the same week against the corresponding week last year.

The company moved over 40,000 containers in the reported week of 2016, compared with 40,000 containers in the corresponding week of 2015. The percentage rise in CNI’s intermodal volumes was in tune with the flatness reported by Canadian railroads.

A Look at Canadian National&#8217;s Intermodal Volumes

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Why is intermodal important for CNI?

Canadian National’s intermodal business contributed 26.0% of its revenue in 3Q16. Of its total carloads in that quarter, intermodal’s share was 41.8%. Canadian National also operates one of the largest trucking services in Canada. It supplements its intermodal business.

Canadian National’s competitive advantage comes from its sole access to the port of Prince Rupert in British Columbia. CNI also connects in a long arc from Vancouver, British Columbia, and Prince Rupert, British Columbia. This, in turn, provides opportunities for the company to move containers from Asia to the US heartland.

CNI’s domestic segment is driven by consumer markets and US and Canadian economic growth. Its international segment is influenced by North American economic and trade conditions. In the intermodal segment, the company faces competition from truckload companies such as J.B. Hunt Transport Services (JBHT), Heartland Express (HTLD), Swift Transportation (SWFT), and Landstar System (LSTR).

If you seek exposure to the transportation sector, you could invest in the Guggenheim S&P 500 Equal Weight ETF (RSP). All US-originated Class I railroads are included in the portfolio holdings of RSP.

If you’re interested in comparing this week’s traffic data with the previous week’s, you can refer to Freight Rail Traffic for the Week Ended December 10. For more information on US major railroad stocks, visit Market Realist’s Railroads page. In the next part, we’ll take a look at CNI’s archrival, Canadian Pacific Railway (CP), and its weekly rail traffic data.

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