If I Could Only Buy and Hold a Single Stock, This Would Be it

If I had to choose just one Canadian stock to buy and hold forever, it would be Canadian National Railway (TSX:CNR). It might not be flashy like a tech stock or exciting like a small-cap growth play, but it has something far better: reliability. In a world that constantly changes, the need to move goods across long distances doesn’t. And that’s where CNR shines. So, let’s get into it.

About CNR

CNR operates the largest rail network in Canada, stretching from coast to coast and deep into the United States. It connects the Atlantic, Pacific, and Gulf coasts, making it one of the only railroads in North America with that kind of reach. That gives it a built-in advantage. It’s essential to the North American economy, hauling everything from oil and grain to intermodal containers, cars, and lumber. No matter what the economy is doing, something always needs to be moved.

What really sets CNR apart is its consistent performance. In the most recent earnings report for the first quarter of 2025, the Canadian stock reported revenue of $4.4 billion, up 4% from a year earlier. Net income hit $1.16 billion, an increase of 5%, while diluted earnings per share (EPS) rose 8% to $1.85. Free cash flow came in at $603 million. That’s a big deal. Free cash flow is the money left over after the company reinvests in operations. Basically, it’s the cash it can use to pay dividends, reduce debt, or invest for growth.

The company also posted an operating ratio of 63.4%, a slight improvement from last year. This number measures efficiency, with lower numbers being better. CNR’s consistent ability to improve this ratio speaks to its operational discipline. That discipline has helped it generate strong returns over the long term. Even in an inflationary environment with rising labour and fuel costs, it continues to find ways to boost profits.

Strong performance

Year to date, the Canadian stock is actually down by about 3%. However, when you’re holding a Canadian stock for the long haul, this is like a golden opportunity — especially when it comes with long-term dividend growth. CNR currently pays an annual dividend of $3.55 per share, which works out to a yield of around 2.5% at recent prices. That yield might seem low, but it’s important to look at the company’s history. It has raised its dividend every year for more than 25 years. If you bought this Canadian stock 10 years ago and held it, your yield on cost would be much higher today. It’s the kind of investment that rewards patience.

CNR also offers built-in diversification. Its business isn’t tied to any one commodity or customer. It hauls grains, fertilizer, metals, lumber, consumer goods, oil, chemicals, and cars. If one area slows down, another can pick up the slack. That makes it more resilient than many other businesses.

There are risks, of course. The railway industry is sensitive to economic slowdowns. If fewer goods are being produced or shipped, that can cut into volumes. Labour strikes, fuel price spikes, or regulatory changes can also cause disruption. But CNR has navigated these kinds of challenges many times. It has shown it can adapt and still deliver strong results.

Bottom line

Looking ahead, the company expects to grow earnings per share by 10% to 15% this year, which is impressive for a business of its size. It’s investing in technology, expanding its network, and upgrading its fleet. It’s also returning capital to shareholders through dividends and share buybacks. Meanwhile, investors could earn around $887.50 if they invested about $35,000 today. An investment that should continue to grow at a stable clip.

If I could only buy one Canadian stock, I’d want one that doesn’t need to be watched every day. I’d want something I could put in a drawer and come back to in 20 years. Canadian National Railway fits that bill. It’s not just a transportation company. It’s the backbone of the Canadian economy. And that’s why it’s the stock I’d hold forever.