What to Know About Canadian Transportation Stocks for 2025

Transportation stocks may look a bit up and down with recent tariffs weighing on investors, so what about 2025?

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published March 27, 2025 4:20 pm EDT

Transportation is the lifeblood of Canada’s vast landscape, connecting communities and driving economic growth. As we journey through 2025, the transportation sector presents a mix of challenges and opportunities for investors. Let’s explore some of the key players in this space, focusing on companies listed on the TSX.

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Air Canada

Air Canada (TSX:AC) stands as the nation’s largest airline, navigating the skies with resilience. In the fourth quarter of 2024, the transportation stock reported operating revenues of $5.404 billion, a 4% increase from the same period in 2023. This uptick was largely due to a 5% capacity growth, allowing the airline to carry approximately 47 million passengers throughout the year.

Despite these gains, Air Canada faced an operating loss of $254 million in the quarter, influenced by a one-time $490 million charge related to pension plan amendments. For the full year, net income reached $1.720 billion, down from $2.276 billion in 2023. Looking ahead, the airline forecasts adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) between $3.4 billion and $3.8 billion for 2025, aiming for continued recovery amid evolving travel demands.

Cargojet

Cargojet (TSX:CJT) plays a pivotal role in Canada’s overnight air cargo services, ensuring timely deliveries across the country. The surge in e-commerce has propelled its growth, with total revenues reaching $1.0 billion in 2024, up from $877.5 million the previous year.

In the fourth quarter alone, revenues were $293.2 million, marking a 32.1% increase year over year. Net earnings for the quarter stood at $71.2 million, a significant turnaround from a net loss of $34.9 million in the same period of 2023. This robust performance underscores Cargojet’s adaptability in meeting the rising demands of online retail.

TFI International

TFI International (TSX:TFII), a leader in transportation and logistics, has been making strategic moves to bolster its position. In February 2025, the transportation stock announced plans to shift its legal registration from Canada to the U.S., aligning with its substantial American operations and shareholder base. Chief Executive Officer Alain Bédard emphasized that about 70% of TFI’s activities are in the U.S., making this transition a logical step.

However, the transportation stock went on to reverse the decision after pushback from shareholders. Now, the company intends to maintain its listing on the TSX, ensuring continued accessibility for Canadian investors. However, shares are now down over 40% since the original announcement. And this could lead to a value investment for patient investors.

CPKC

Canadian Pacific Kansas City (CPKC) (TSX:CP) operates an extensive rail network connecting Canada, the U.S., and Mexico, facilitating vital trade routes. The recent political climate, particularly with U.S. president Donald Trump’s proposed tariffs on Canadian and Mexican goods, has introduced uncertainties.

CPKC’s leadership remains focused on navigating these challenges, emphasizing the railroad’s integral role in North American commerce. Investors are closely monitoring how these geopolitical factors may influence the transportation stock’s performance in the coming months. And it’s something Canadians will want to watch as well.

Bottom line

Investing in the transportation sector requires a keen understanding of market dynamics and company-specific strategies. While the industry offers avenues for growth, it’s essential to consider factors like fuel costs, regulatory changes, and global economic conditions. Transportation stocks like Air Canada and Cargojet have demonstrated resilience, adapting to shifting demands and capitalizing on emerging opportunities. However, potential investors should conduct thorough research and assess their risk tolerance before making decisions.

Canada’s transportation sector in 2025 is marked by both resilience and transformation. From airlines rebounding in a post-pandemic world to logistics companies adapting to e-commerce trends, the landscape is dynamic. As always, informed investment choices, grounded in current data and a clear understanding of individual financial goals, are key to navigating this evolving terrain.