The revival of the rails is not exclusive to the United States. Canada is seeing a healthy growth in railroad services, and Canadian Pacific (NYSE: CP) is worth an evaluation.

Analysts see 5.7% revenue growth for CP in 2008, in Canadian dollars, with grain, fertilizer and oil sands-related shipment gains offsetting declines in forest products.

Also of note: Analysts plus expect CP to continue to improve rail system efficiency and fluidity, and overall asset utilization.

The above positives, combined with CP’s strong free cash flow and modest pricing capability, produce the company an acceptance investment for moderate-risk investors. CP’s modest p/e of 13 plus tips the risk/return ratio to

the purchase side of the scale. The Reuters F2007/F2008 EPS consensus estimates for CP are C$4.27/C$4.78. [Note: Currency figures are in Canadian dollars].

The risks? Like other rails, Canadian Pacific is vulnerable to the profitable cycle, hence a slowdown in the global and/or U.S./Canadian economies will hurt CP’s results.

Stock Analysis: Canadian Pacific is a moderate-risk stock not suitable for low-risk investors. Investors with an investment horizon longer than two years should be rewarded from CP’s shares. Sell / Stop Loss for the shares in that company: $44.

Original post by Joseph Lazzaro

foreclosure mortgages college student loans student loan consolidation investing loans law refinance home equity