CN expands firefighting capabilities with new railcars and upgrades

MONTREAL - Canadian National Railway (TSX:CNR) (NYSE:CNI), a prominent player in North America’s ground transportation industry with a market capitalization of $59.35 billion, announced Monday it has expanded its firefighting capabilities with new assets and upgrades to its specialized fire suppression fleet to protect rail infrastructure during wildfire season. According to InvestingPro data, the company maintains impressive gross profit margins of over 55%, demonstrating strong operational efficiency.

The railway operator has introduced two independent firefighting railcars, named Oceanus and Amphitrite, each carrying 25,000 gallons of water and equipped with cannons, pumps, and hose support. These units can be deployed rapidly and operate either independently or with larger trains. This infrastructure investment aligns with the company’s moderate debt approach, as identified by InvestingPro analysts.

CN has also launched a pilot program testing fire trailers for smaller fires along rail rights of way. Each trailer holds 350 gallons of water and features a fixed water cannon for off-track wildfire response.

To strengthen efforts in British Columbia, the company has stationed eight additional 30,000-gallon tank cars in strategic locations to ensure additional water supply in water-scarce regions.

The company is also enhancing its existing Neptune, Trident, and Poseidon trains, which were first deployed during the 2024 Jasper wildfires. These assets are being upgraded to more than double their water capacity, improving CN’s ability to assist emergency efforts near rail infrastructure and in hard-to-reach fire zones.

"At CN, our priority is to safeguard the critical rail infrastructure and supply chains that communities and businesses rely on every day," said Mark Grubbs, Vice-President of Safety and Environment at CN, in a press release statement.

CN operates a nearly 20,000-mile rail network connecting Canada’s Eastern and Western coasts with the U.S. Midwest and Gulf Coast, transporting more than 300 million tons of goods throughout North America annually. Currently trading near its 52-week low, InvestingPro analysis suggests the stock is slightly undervalued, with 10+ additional exclusive insights available to subscribers. For detailed analysis and comprehensive valuation metrics, investors can access the full Pro Research Report, available among 1,400+ top stocks covered by InvestingPro’s expert analysis.

In other recent news, Canadian National Railway reported second-quarter adjusted diluted earnings per share of C$1.87, aligning with analyst expectations. This figure was slightly below Citi’s estimate of C$1.92 but matched Bernstein’s estimate of C$1.85 and was between the consensus estimate of C$1.88 and Benchmark’s forecast of C$1.88. Following these earnings results, several financial firms adjusted their outlooks on the company. Bernstein lowered its price target to C$149 from C$158 while maintaining a Market Perform rating. Wells Fargo also reduced its price target to $117 from $120, citing challenges such as mix headwinds and increased costs affecting margins. Evercore ISI downgraded the stock from Outperform to In Line, reducing its price target to $105 due to volume concerns. Citi adjusted its price target to $121 from $123, maintaining a Buy rating despite the macroeconomic headwinds.

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