We recently compiled a list of the 10 Best Shipping Stocks To Invest In Now. In this article, we are going to take a look at where Canadian National Railway Company (NYSE:CNI) stands against other best shipping stocks to invest in now.
Shipping refers to the transportation of goods and commodities from one place to another, encompassing various modes of transportation such as road, rail, air, and sea. The shipping industry plays a vital role in connecting businesses and consumers across the globe by facilitating the exchange of goods and driving economic growth. From the delivery of online purchases to the transportation of raw materials and finished goods, shipping plays an essential component of modern commerce. According to a report by Fortune Business Insights, the cargo shipping market size was recorded at 11.89 billion tons in 2024 and is expected to reach 14.72 billion tons by 2032, exhibiting a CAGR of 2.7%. The industry is diverse, with companies specializing in different modes of transportation, such as trucking, rail freight, air cargo, and marine shipping, as well as logistics and courier services.
Investing in shipping stocks can be a lucrative opportunity, as the industry is closely tied to consumer spending, economic growth, and global trade. As e-commerce continues to grow, the demand for fast and reliable shipping services is increasing, driving up revenues and profits for shipping companies. Additionally, the rise of just-in-time manufacturing and same-day delivery is creating new opportunities for companies that can provide flexible and efficient logistics solutions. The shipping industry is also experiencing a shift towards digitalization, with the adoption of technologies such as blockchain, artificial intelligence, and the Internet of Things (IoT) to improve efficiency, reduce costs, and enhance customer experience.
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According to a report by Hillebrand Gori, part of DHL Global, the shipping industry has experienced significant growth and evolution in 2024, marked by both opportunities and challenges. The report highlights the persistent growth in demand, driven by strong market activity across key regions, particularly in North and Latin America.
The growth in demand has been met with an expansion in the global container fleet, which is set to increase by a further 5% in 2025. However, the report notes that operational challenges, such as re-routings due to geopolitical risks in regions like the Red Sea, continue to affect capacity and scheduling. Vessels are often rerouted, leading to delays and higher fuel costs. Additionally, labor unrest in countries such as India and on the U.S. East Coast disrupted supply chains. Companies must adapt to these pressures by investing in resilient logistics solutions and closely monitoring geopolitical developments.
The report also notes that ocean freight rates have been volatile in 2024, primarily due to capacity shortages and rerouting costs. While rates may soften in certain trade lanes, others, such as those connecting Oceania and the Atlantic, are expected to remain high. Looking ahead, the report suggests that the shipping industry will continue to experience both opportunities and uncertainties.
The shipping industry plays a vital role in facilitating trade and connecting markets in the global economy. As e-commerce growth accelerates, and the economy stabilizes, shipping companies are well-positioned to capitalize on emerging opportunities.
A driverless train traversing vast countryside, illustrating the companies long-distance rail transport services.
Our Methodology
To compile our list of the 10 best shipping stocks to invest in now, we scanned transportation ETFs plus online rankings to compile an initial list of 25 companies that offer shipping services. We then used Insider Monkey’s Hedge Fund database to rank 10 stocks according to the largest number of hedge fund holders, as of Q3 2024. The list is sorted in ascending order of hedge fund sentiment.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Canadian National Railway Company (NYSE:CNI)
Number of Hedge Fund Investors: 44
Canadian National Railway Company (NYSE:CNI) is a major shipping railway operator in North America, connecting ports and markets across Canada and the United States. The company transports a wide range of goods, including consumer products, automotive parts, and energy products. Canadian National Railway Company (NYSE:CNI) serves industries such as agriculture, retail, and manufacturing.
Canadian National Railway Company (NYSE:CNI) is prioritizing growth in its intermodal business, particularly through Western Gateways, by leveraging its end-to-end supply chain efficiency to attract increased traffic. The company is making strategic investments in technology to enhance maintenance scheduling, reduce dwell times, and improve overall reliability. Canadian National Railway Company (NYSE:CNI) is also expanding terminal capacity and infrastructure, including the Greater Toronto Area fuel terminal and plant capacity on both sides of the border. While the domestic intermodal market remains soft, growth is expected in the coming quarters, driven by robust international volumes, supported by high demand for Canadian and US grain.
Additionally, the Canadian National Railway Company (NYSE:CNI) is implementing measures to optimize resources, such as halting hiring in surplus areas and furloughing non-essential personnel and locomotives. These actions aim to maintain operational fluidity and reduce costs while ensuring the company is prepared to scale operations quickly as volumes recover.
Overall CNI ranks 7th on our list of the best shipping stocks to invest in now. While we acknowledge the potential of CNI as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CNI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
