15 Dividend Stocks With Low Payout Ratios and Strong Upside

12. Canadian National Railway Company (NYSE:CNI)

Number of Hedge Fund Holders: 34

5-Year Average Payout Ratio: 41.29%

Upside Potential as of December 24: 28.04%

Canadian National Railway Company (NYSE:CNI) is among the best dividend stocks to invest in.

On December 18, RBC Capital lowered its price target on Canadian National Railway Company (NYSE:CNI)to C$153 from C$158 and kept an Outperform rating. The change came as part of a broader note previewing fourth-quarter results for Class I railroads. The firm said it refreshed its models using updated carload trends, management commentary from conferences, and its own channel checks.

Trade uncertainty between Canada and the US has weighed on visibility. That backdrop pushed Canadian National Railway Company (NYSE:CNI) to cut its 2025 guidance and step away from its original 2026 outlook. Management had initially expected adjusted earnings growth of 10% to 15% in 2025 versus the prior year. Current expectations point to earnings growth that is still positive, but likely below that 10% mark.

This is not a near-term story. Investors will need patience, as over time, the setup remains appealing. Canadian National Railway Company (NYSE:CNI) benefits from long-term economic growth and rising trade volumes. Its scale, network density, and steady earnings profile make it the kind of business that can be held through multiple cycles. The company remains highly profitable and operates a rail network that is difficult to replicate. Its lines connect Canada’s Atlantic and Pacific ports with the US Gulf Coast, giving it strategic relevance across North American trade routes. At some point, Canada and the US will reach a new trade framework. When that happens, CN should see renewed momentum.

Canadian National Railway Company (NYSE:CNI) provides transportation and logistics services across rail, intermodal, trucking, and supply chain operations.