On Thursday, Canadian National Resources (CNR:CN) (NYSE: CNR) received an upgrade in its stock rating from National Bank Financial, moving from Sector Perform to Outperform. The financial firm has maintained its price target for the company at Cdn$190.00.
The upgrade comes amid a favorable outlook on the company's potential performance. National Bank Financial cites a "reasonably constructive volume environment" and increasing confidence in this year's grain harvest as key factors contributing to their positive assessment. These elements are expected to support Canadian National Resources in achieving its management's guidance for a 10% growth in earnings per share (EPS) for the current year.
The analyst also noted the recent decline in the company's stock price as an opportunity, pointing out that the shares are now trading at a more appealing valuation. Specifically, the stock is currently valued at 20.2 times the current year's EPS, which is below its historical forward average of 22.2 times.
Despite the upgrade, the firm's price target for Canadian National Resources remains steady at Cdn$190.00. The unchanged target suggests that while the outlook has improved, the firm's long-term valuation of the company's stock remains consistent with previous assessments.
InvestingPro Insights
The recent upgrade of Canadian National Resources (NYSE: CNR) by National Bank Financial aligns with some intriguing metrics on InvestingPro. The company's Market Cap stands at a modest $62.92M, with a Price to Book ratio for the last twelve months as of Q4 2023 at 1.11, indicating that the stock may be trading at a fair value relative to its book worth. The EBITDA Growth over the same period showed a notable increase of 33.84%, reflecting potential operational efficiency improvements or increased profitability.
InvestingPro Tips highlight the importance of considering the PEG Ratio, which for CNR is currently -0.88, suggesting the stock's price may not be fully aligned with expected earnings growth. Additionally, the current P/E Ratio stands at -22.27, and adjusted for the last twelve months as of Q4 2023, it is at -29.54, which could indicate the market's cautious stance on future earnings potential.
For those looking to delve deeper, InvestingPro offers additional insights and tips, with PRONEWS24 providing an extra 10% off a yearly or biyearly Pro and Pro+ subscription. With these tools, investors can gain a more comprehensive understanding of Canadian National Resources' financial health and make more informed decisions.
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