David CockfieldCanadian Pacific RailCP.TOCOMMENTAug 15, 2014

CNR had the advantage in early days, with all kinds of government money spent on it. If he had to choose today, he'd pick CP. Seems to have an expansive view with KSU takeover, more aggressive growth strategy, better growth possibilities.

The rails face pressure from the current economy, but the economy will expand in the next 10 years. So, the rails will do well as they move goods. Yes, it's good to hold in a TFSA.

The rails trade in tandem. With CP buying Kansas City, CP now competes head-to-head with CNR which used to have more of a north-south network. He isn't jumping into these stocks, because of a possible recession later this year. If you're a long, long-term holder, holding rails isn't bad, but he wouldn't but them now.

Canadian railroads have 15% compound returns going back 30 years. CP has done way better than CNR. Wishes he owned CP, and you probably should own both. Will see buybacks, dividend increases, growth at GDP+. Always cutting costs. Will see double-digit returns for a very long time. Nothing can displace railroads. Drones just can't move the heavy stuff.

Bullish because we'll see more onshoring. Hard to tell if we're going into recession or accelerating. Should see restocking of inventory. 

Likes overall business. Technically, if line does not hold, stock could fall. If economic recession, stock price will fall. Would recommend half position, waiting for weakness. 

This and CN got hit by the wildfires, so they had lousy quarters. Otherwise, it depends on the harvest, commodities and housing (moving lumber). A good company, more efficient than CN. Own one or the other, which should do better in 2024.

Sounds as though the amalgamation is going well. The benefit is that the network now goes North-South, East-West. He owns CNR instead. 

Under pressure, but his view is longer term. Assets are irreplaceable. Overall, should grow with the economy and increase prices. Synergies from merger will last a long time. It will take longer, but eventually a NA powerhouse.

Owns shares in business. Excellent business with legacy assets. Mexico to Canadian railway valuable. Good at capital allocation. Strong investment for long term investors. 

It's in the public interest to get this pipeline going, as it will be great for Canadian energy producers as a whole. Won't have a negative impact on the rails. Rail is not the most efficient for shipping oil, it's the overflow option. 

He's positive on CNR and CP, more so on CP with its unique footprint integrating Canada-US-Mexico. Between onshoring and its management team, going to do quite well. Trades at a premium because of this.

Rails depend on overall economic activity. Rates will probably produce at least a temporary slowdown in economic growth. Price has come off. Next cycle could be 3-7 years from now. Starting to look attractive, good time to look at where you might pick it up. He hasn't jumped in yet. Kansas City acquisition makes it more competitive.

Great acquisition of Kansas City by CP was a game changer. CNR is the gold standard in North America. US is not in a recession yet, but if it does happen, all the rails will get cheaper. Don't settle for just a 1% differential from the historical average, when you might be able to get it 20% cheaper.

He prefers trucking, though CP now has an integrated network across North America after the KC deal. But the consumer sector is less robust now. CP is probably good medium/long-term, but will lag short-term.

It is a cyclical stock and he sees a pullback in the economy. There may not be even a soft landing so rates could still rise. He is not keen on railway stocks.

CP PEG is almost even at 1.0, so it's the best value. Though he likes this one, this is the one he'd trim in his portfolio if he were absolutely forced to.