Info on Analyst UPGRADECHICAGO, Jan 12 (Reuters) -
Investment bank Bear Stearns said on Friday it was upgrading Canadian National Railway to "outperform" from "peer perform," citing expected volume growth in 2007 plus stock buybacks or dividend increases.
Bear Stearns analysts said in a research note that Canadian National is trading 12 percent below its one- and three-year averages, adding: "Our sense is downside is limited and upcoming catalysts include Canadian National using its free cash to make acquisitions, buying back stock and/or increasing its dividend and a likely settlement with its unions some time in (the first quarter) after a bit of wrangling."
The analysts also see deferred volumes from recent storms, easy comparisons (particularly paper & lumber), incoming Asian trade via the Canadian port of Prince Rupert, continued Canadian oil sands business and "potential tuck-in acquisitions as drivers of volume growth during 2007." ((Reporting by Nick Carey, editing by Gerald E, McCormick; Reuters Messaging: nick.carey.reuters.com@reuters.net; email: nick.carey@reuters.com; +1-312-408-8756)) Keywords: CANADIANNATIONAL RESEARCH/