IoC

INVESTMENT RESEARCH MAY 17, 2023 11:35 PM Table Of Contents 1. Canadian National Railway Co. (CNR.TO): Reinstating at Neutral: Solid Prospects for 2022 OR Improvement; Other Rails with More Upside Goldman Sachs, Jordan Alliger Sep 23, 2021 08:20 AM Canadian National Railway Company 11 Pages 2. M&A talks resuming with rumours KSU could be acquired by private equity group—not a new industry trend Desjardins Securities Inc., Benoit Poirier Aug 03, 2020 10:45 PM Canadian National Railway Company 4 Pages 3. Initiating Coverage at In Line; $81 PT Evercore ISI, Jonathan Chappell Mar 26, 2020 10:10 AM Canadian National Railway Company 20 Pages 4. Morning Call - Jul 11 2019 TD Cowen Jul 11, 2019 11:58 AM Canadian National Railway Company 8 Pages

Key Data __________________________________ GS Forecast ________________________________ GS Factor Profile ____________________________ Source: Company data, Goldman Sachs Research estimates. See disclosures for details. Market cap: C$104.6bn / $82.0bn Enterprise value: C$116.7bn / $91.5bn 3m ADTV: C$196.1mn / $155.4mn United States Americas Transportation M&A Rank: 3 12/20 12/21E 12/22E 12/23E Revenue (C$ mn) 13,818 . 7 14,580 . 3 14,946 . 5 15,982 . 3 EBITDA (C$ mn) 6,851 . 7 7,157 . 8 8,001 . 0 8,645 . 5 EBIT (C$ mn) 5,262 . 7 5,532 . 7 6,372 . 3 6,946 . 6 EPS (C$) 5 . 31 5 . 75 6 . 80 7 . 55 P/E (X) 23 . 9 25 . 5 21 . 6 19 . 4 EV/EBITDA (X) 14 . 9 16 . 2 14 . 3 12 . 7 FCF yiel d (%) 3 . 6 4 . 6 3 . 9 4 . 9 Divi d en d yiel d (%) 1 . 8 1 . 7 1 . 7 1 . 7 Net d ebt/EBITDA (X) 1 . 7 1 . 7 1 . 9 1 . 4 6/21 9/21E 12/21E 3/22E EPS (C$) 1 . 49 1 . 39 1 . 66 1 . 45 CNR.TO relative to Americas Coverage CNR.TO relative to Americas Transportation Growth Fi nanc i al Re t u r ns Mul ti ple In t eg r a t ed Percentile 20th 40th 60th 80th 100th Bottom Line: We remove the Not Rated (NR) designation and reinstate our rating on Canadian National at Neutral. Our price targets are C$152/US$121 per share, which represents about 3% upside from current share price levels. While the company put forward a solid plan with specific cost and price related goals as part of its strategic update , our 2022 EPS forecast of C$6.80 per share, up almost 20% versus our 2021 estimate, already seems to be largely reflected in valuation which stands at 21.6x, or slightly ahead of +1 SD above 5-year historical average of the rail industry (we raised our EPS forecast by C$0.05 in our rail preview ). While we are encouraged by CN management's focus on cost optimization, the share price upside is not as significant as other rails in our coverage at this point in time (for Buy rated rail names we have +23% share appreciation potential on average). That said, should volumes accelerate faster than forecast, and/or operating execution run ahead of plan, it is conceivable that additional upside to margin and in turn EPS could arise - something we would look to monitor to assess whether additional share price upside relative to our current target could at some point be justified if our EPS estimates indeed prove to be conservative. We would also point out that the Canadian grain harvest is looking weak - and with grain being about 22% of CN carloads (ex-intermodal; 12% of total carloads), this is a headwind that must be taken into consideration when assessing EPS upside potential. Price Target Methodology: Our price targets of C$152/US$121 are based on a target P/E multiple of approximately 21x, which is 1-SD above the 5-year average for all rails and applied on recently raised Q5-Q8 EPS estimates — we recently lowered near-term estimates to reflect lower volumes but raised out years to account for CNR.TO 12m Pri c e Target: C$152.00 Pri c e: C$146.69 Upside: 3.6% CNI 12m Pri c e Target: $121.00 Pri c e: $115.00 Upside: 5.2% Canadian National Railway Co. (CNR.TO) Reinstating at Neutral: Solid Prospects for 2022 OR Improvement; Other Rails with More Upside 23 September 2021 | 3:13AM EDT Goldman Sachs does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclosure Appendix, or go to www.gs.com/research/hedge.html . Analysts employed by non-US affiliates are not registered/qualified as research analysts with FINRA in the U.S. Jordan Alliger +1(212)357-4913 | [email protected] Goldman Sachs & Co. LLC Paul Stoddard +1(801)744-3761 | [email protected] Goldman Sachs & Co. LLC Neutral 2aeb9e8b174644998c7303f5a989d953 For the exclusive use of Solange Dive ([email protected]) at Perella Weinberg Partners