If a rising tide can lift even the sorriest, leakiest, no-account boats, what happens to the sleekest and best? If you're Canadian National Railway (NYSE:CNI), you also get to go on a ride.

I haven't been shy in professing my love for this Class 1 operator, and my faith in the company (apart from its stock) continues to be rewarded. Revenue this quarter? Up 8% as reported, and it would have been up 11% if not for the impact of currency. With ongoing operational improvements, the company managed to transmogrify that revenue boost into 19% higher operating income and 27% higher earnings per share. (That figure also beat estimates, by the way.)

It seems to me that Canadian National keeps doing more with what it's got. Revenue was up 8%, but carloads were flat, route miles were up only 4%, and revenue-ton-miles were up less than 2%. Management broke its revenue growth into thirds, equally crediting product mix, pricing, and fuel surcharges.

Canadian National also remains a very well-run railroad. The operating ratio (a measure of expenses) fell yet again, to a level that even well-run U.S. operators like NorfolkSouthern (NYSE:NSC) and Burlington Northern (NYSE:BNI) are hard-pressed to match. Same goes for the efficiency metrics -- Canadian National scores very well in categories like average dwell time and average system speed, though their scheduled-service offerings make the dwell-time comparisons a bit less fair.

So long as the brisk trade in Canadian resources and materials continues, Canadian National should do well. I've been skeptical (and wrong) about railroad stocks for a while now, but I'm trying to come around. With superior returns that exceed the cost of its capital, and a relative valuation that doesn't necessarily account for that efficiency, Canadian National is likely still my top pick in the big rails. Nonetheless, I'd like to see the rest of the sector report their earnings. Also, I might still be wrong in my valuation targets on these companies, but I'd still like a greater discount on these shares before buying.

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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).