Canadian Pacific Rail (CP.TO)

Time to short this stock? He is Short this and he thinks it is still a Short. It might be painful for a while. Valuations are very high. You could do a hedge by Shorting this and going Long Canadian National (CNR-T) or CSX Corp (CSX-N) against it, which is what he has done.

Interesting situation in the Cdn equity market. Great company. Railroads are long-term infrastructure play however, there are a lot of people in this stock who are not long-term investors, which makes him nervous. If you own, you could consider taking some off the table. It is less than at a 2% yield now.

Missed this run, was surprised by it, thinks others were surprised by it too. It's about operational improvment. Bringing Hunter Harisson back. Now trading at 30x earnings. Too expensive right now.

Is Price based on financial consideration, or just the hype? He feels it's based on rapidly improving fundementals. They have sold and taken profits. The company is strong and has good management, but he wouldn't buy more at this level.

He is expecting it to go down in the summer months.

(Sell or continue to Hold?) He sees a combination of 1) single digit top line growth for the next 3 years combined with 2) efficiency ratio falling in a big way which conspires for enormous shareholder growth. However, at 20X, it is really reflected in the stock. Thinks you could buy it here but feels there is better value in Canadian National (CNR-T). CNR is going to be more impacted by weather this quarter so it will probably be a better buy.

Feels this one is priced to perfection. Wouldn’t be a buyer at this price. If you own, consider taking some profits. Use a stop loss of somewhere around $125-$126.

There is much more risk in this rail than there is in Canadian National (CNR-T). The stock is already reflecting the changes that are expected in the company.

Analysts really like it, but personally he finds it difficult when a stock has gone parabolic like this to capture any upside from here. In the next correction this could fall 10-15% easily.

There is a lot of good news in the stock. There is a turn-around team in there. The price of the stock gives the team all the benefits of the turn-around.

Selling at a multiple premium over Canadian National (CNR-T), which has a proven track record. If you have only just bought it, he would suggest taking your profits and run. Has moved very rapidly and has got some proving to do over the next couple of years.

Positive elements going on in the rail sector. More demand from oil/gas companies because of the shortage of pipeline capacity. At these levels, some of the good news is baked into the price. If you own and you have done very well, you might want to consider taking half of your money off the table.

Sold his holdings last fall because of all the excitement surrounding the stock. Moved his money into Canadian National (CNR-T). Feels there are a lot of people in this stock who are not necessarily investors and there is a lot of momentum trading. Over a long time period this company will do just fine. Trading at 27X earnings.

Recommending because of the new management that has taken charge. They are continuing cost stripping in operating and efficiency model.

Remarkable how much faith people have put into the new management. Stock is up 40%. He is a little worried that people have gotten over enthusiastic about the turnaround story. It’s not that easy to change it overnight.