OTTAWA — Stock in Canadian National Railway Co., down $5.77, to $74.35, on volume of 1.8 million shares, was pummelled even though CN reported on Monday a 14% increase in first-quarter earnings before unusual items, the National Post reports.
“The quality of the earnings was not what is typically Canadian National,” said one U.S. analyst, asking not to be identified. “A lot of the revenue came from the ‘other income’ line so the operating income line, the number they posted, was for most analysts in the street far short of what most had estimated, even though they had hit the overall earnings per share estimate.”
CN recorded $38-million in other income in the quarter, up from $11-million a year ago, once proceeds from the sale of the Detroit River Tunnel are removed.
Also of concern, the analyst said, is sharp decline in grain shipments, down 21% on a revenue-ton-mile basis from last year.