Union Pacific (NYSE:UNP) Shares Gap Up Following Better-Than-Expected Earnings

Union Pacific Corporation (NYSE:UNP)’s share price gapped up before the market opened on Thursday following a better than expected earnings announcement. The stock had previously closed at $292.56, but opened at $309.90. Union Pacific shares last traded at $310.7330, with a volume of 1,061,737 shares.

The railroad operator reported $3.41 earnings per share (EPS) for the quarter, beating the consensus estimate of $3.25 by $0.16. Union Pacific had a net margin of 29.20% and a return on equity of 39.58%. The firm had revenue of $6.86 billion for the quarter, compared to analysts’ expectations of $6.72 billion. During the same period in the prior year, the company posted $3.03 earnings per share. The firm’s quarterly revenue was up 11.5% on a year-over-year basis.

Union Pacific Dividend Announcement

The company also recently announced a quarterly dividend, which was paid on Tuesday, June 30th. Stockholders of record on Friday, May 29th were given a $1.38 dividend. The ex-dividend date was Friday, May 29th. This represents a $5.52 annualized dividend and a dividend yield of 1.8%. Union Pacific’s dividend payout ratio (DPR) is presently 45.47%.

Key Stories Impacting Union Pacific

Here are the key news stories impacting Union Pacific this week:

• Positive Sentiment: Union Pacific posted adjusted Q2 EPS of $3.41, ahead of the $3.25 consensus, while revenue of $6.86 billion also beat expectations of $6.72 billion. The railroad said revenue rose 11.5% from a year earlier, pointing to solid operating momentum. Article Title
• Positive Sentiment: The company also reported that adjusted net income increased 12% and adjusted diluted EPS increased 13% year over year, with management citing stronger volume growth. Article Title
• Positive Sentiment: Union Pacific and CN announced a binding memorandum of understanding tied to Union Pacific’s proposed acquisition of Norfolk Southern, with CN agreeing not to oppose the deal in exchange for expanded access rights. Investors may view this as reducing merger uncertainty and improving the odds of regulatory approval. Article Title

Analyst Upgrades and Downgrades

UNP has been the topic of several research reports. BMO Capital Markets reissued a “market perform” rating and set a $285.00 price target (up from $278.00) on shares of Union Pacific in a research report on Friday, April 24th. Barclays reiterated an “overweight” rating and set a $315.00 target price (up from $285.00) on shares of Union Pacific in a research note on Friday, April 24th. UBS Group reissued a “neutral” rating and set a $274.00 target price (up from $253.00) on shares of Union Pacific in a report on Friday, April 24th. Wells Fargo & Company lifted their price target on shares of Union Pacific from $300.00 to $315.00 and gave the company an “overweight” rating in a report on Wednesday, July 8th. Finally, Citigroup started coverage on shares of Union Pacific in a research report on Wednesday, July 15th. They set an “outperform” rating for the company. Two equities research analysts have rated the stock with a Strong Buy rating, thirteen have issued a Buy rating and seven have issued a Hold rating to the company. Based on data from MarketBeat, the stock currently has an average rating of “Moderate Buy” and an average price target of $299.11.

Insiders Place Their Bets

In other Union Pacific news, EVP Eric J. Gehringer sold 2,991 shares of the firm’s stock in a transaction on Wednesday, June 3rd. The stock was sold at an average price of $263.96, for a total value of $789,504.36. Following the sale, the executive vice president directly owned 43,012 shares in the company, valued at approximately $11,353,447.52. This trade represents a 6.50% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through this link. Also, EVP Kenyatta G. Rocker sold 27,387 shares of the business’s stock in a transaction on Friday, April 24th. The shares were sold at an average price of $271.76, for a total transaction of $7,442,691.12. Following the transaction, the executive vice president directly owned 61,102 shares of the company’s stock, valued at approximately $16,605,079.52. This trade represents a 30.95% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 32,378 shares of company stock valued at $8,781,595 over the last three months. Company insiders own 0.22% of the company’s stock.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently bought and sold shares of UNP. Vanguard Group Inc. increased its position in Union Pacific by 1.1% in the 4th quarter. Vanguard Group Inc. now owns 59,329,262 shares of the railroad operator’s stock valued at $13,724,045,000 after acquiring an additional 659,378 shares during the period. State Street Corp boosted its position in Union Pacific by 4.3% during the 4th quarter. State Street Corp now owns 26,330,080 shares of the railroad operator’s stock worth $6,090,674,000 after acquiring an additional 1,082,285 shares during the period. Capital World Investors boosted its position in Union Pacific by 92.1% during the 4th quarter. Capital World Investors now owns 20,136,349 shares of the railroad operator’s stock worth $4,658,142,000 after acquiring an additional 9,655,306 shares during the period. Geode Capital Management LLC grew its stake in shares of Union Pacific by 2.0% in the fourth quarter. Geode Capital Management LLC now owns 15,360,668 shares of the railroad operator’s stock worth $3,552,550,000 after purchasing an additional 296,814 shares in the last quarter. Finally, Bank of America Corp DE grew its stake in shares of Union Pacific by 16.8% in the first quarter. Bank of America Corp DE now owns 14,463,071 shares of the railroad operator’s stock worth $3,509,030,000 after purchasing an additional 2,084,808 shares in the last quarter. Institutional investors own 80.38% of the company’s stock.

Union Pacific Price Performance

The business has a fifty day moving average price of $273.68 and a 200 day moving average price of $257.46. The company has a debt-to-equity ratio of 1.53, a current ratio of 0.92 and a quick ratio of 0.73. The company has a market capitalization of $184.44 billion, a price-to-earnings ratio of 25.59, a price-to-earnings-growth ratio of 3.07 and a beta of 0.96.

Union Pacific Company Profile

Union Pacific Corporation (NYSE: UNP) is one of the largest freight railroad companies in the United States. Its principal operating subsidiary, Union Pacific Railroad, has roots that trace back to the Pacific Railway Act of 1862 and the construction of the first transcontinental rail link completed in 1869. The company is headquartered in Omaha, Nebraska, and operates as a holding company for rail transportation and related services.

Union Pacific’s core business is the movement of freight by rail across an extensive rail network serving the western two‑thirds of the United States.