Union Pacific (NYSE:UNP – Get Free Report) posted its quarterly earnings data on Thursday. The railroad operator reported $3.53 earnings per share for the quarter, beating analysts’ consensus estimates of $3.47 by $0.06, FiscalAI reports. The company had revenue of $7.20 billion during the quarter, compared to analysts’ expectations of $7.16 billion. Union Pacific had a net margin of 28.90% and a return on equity of 37.54%. The firm’s revenue for the quarter was up 15.3% on a year-over-year basis. During the same period in the prior year, the company posted $3.08 EPS.
Here are the key takeaways from Union Pacific’s conference call:
- Record third-quarter results: Net income reached $2.1 billion, adjusted EPS rose 15% to $3.53, and revenue increased 15% to $7.2 billion on 6% volume growth.
- Union Pacific reported continued operating gains, including a 110-basis-point improvement in its core operating ratio excluding fuel and merger costs, record workforce productivity, improved car velocity, and a 2% reduction in fuel consumption per unit.
- Premium and industrial markets remained strong, with domestic intermodal volume up 13%, international intermodal up 8%, and industrial revenue up 14%; management expects international intermodal volume to grow at a double-digit rate in the fourth quarter.
- Higher fuel prices remain a significant earnings headwind. Diesel averaged $4.21 per gallon in the third quarter and is expected to average approximately $4.85 in the fourth quarter, adding pressure to the reported operating ratio.
- Management continues to pursue regulatory approval for the Norfolk Southern merger, which it expects could close in the second half of 2027; the Surface Transportation Board’s public-comment process and opposition from some railroads and labor groups remain important uncertainties.
Union Pacific Stock Down 1.8%
Shares of UNP traded down $5.24 during midday trading on Friday, hitting $292.85. The company had a trading volume of 3,456,081 shares, compared to its average volume of 2,380,356. The company’s 50 day moving average price is $287.40 and its 200 day moving average price is $278.28. The stock has a market cap of $173.97 billion, a price-to-earnings ratio of 22.83, a PEG ratio of 2.95 and a beta of 0.95. Union Pacific has a 52 week low of $215.53 and a 52 week high of $315.99. The company has a quick ratio of 0.82, a current ratio of 1.16 and a debt-to-equity ratio of 1.32.
Union Pacific Increases Dividend
The business also recently announced a quarterly dividend, which was paid on Wednesday, September 30th. Stockholders of record on Monday, August 31st were given a $1.42 dividend. This represents a $5.68 annualized dividend and a dividend yield of 1.9%. The ex-dividend date of this dividend was Monday, August 31st. This is an increase from Union Pacific’s previous quarterly dividend of $1.38. Union Pacific’s payout ratio is presently 45.99%.
Key Headlines Impacting Union Pacific
Here are the key news stories impacting Union Pacific this week:
- Positive Sentiment: Q3 earnings exceeded expectations: Union Pacific reported adjusted EPS of $3.53 versus the $3.47 consensus and revenue of $7.20 billion versus $7.16 billion expected. Adjusted profit rose 15% year over year, supported by 6% volume growth, pricing gains, fuel surcharges and improved productivity despite higher costs. Reuters: US railroad operator Union Pacific’s quarterly profit rises
- Positive Sentiment: Management maintained its outlook: The railroad reaffirmed expectations for high-single-digit reported EPS growth in 2026 and raised planned 2026 capital expenditures to approximately $3.5 billion, signaling confidence in demand and network investment. Union Pacific affirms 2026 EPS growth outlook
- Positive Sentiment: Analyst support increased: Citigroup raised its price target to $348 and kept a Buy rating, while Stephens lifted its target to $352. StoneX also reiterated its Buy recommendation. Analyst forecasts after Union Pacific Q3 results
- Neutral Sentiment: The Norfolk Southern merger remains a major catalyst: CEO confidence that regulators will approve the transaction supports the long-term growth case, but the proposed deal still requires regulatory review and could create execution and integration risks. Union Pacific CEO merger comments
- Negative Sentiment: Shareholder returns and leadership face pressure: Higher merger-related investment and $3.5 billion of capital spending may limit near-term cash available for dividends, while CFO Jennifer Hamann’s planned retirement after 35 years adds a transition risk. JPMorgan lowered its price target to $321 and maintained a Neutral rating. Union Pacific CFO retirement
Wall Street Analysts Forecast Growth
UNP has been the topic of several recent analyst reports. Citigroup reiterated a “market outperform” rating on shares of Union Pacific in a research note on Friday. Weiss Ratings raised Union Pacific from a “buy (b-)” rating to a “buy (b)” rating in a report on Friday, October 9th. Barclays restated an “overweight” rating and set a $350.00 price objective (up from $315.00) on shares of Union Pacific in a research note on Friday, July 24th. UBS Group restated a “buy” rating on shares of Union Pacific in a report on Friday. Finally, Raymond James Financial reaffirmed a “strong-buy” rating on shares of Union Pacific in a research report on Friday. Two equities research analysts have rated the stock with a Strong Buy rating, fifteen have given a Buy rating and four have assigned a Hold rating to the stock. According to MarketBeat, the stock currently has a consensus rating of “Moderate Buy” and an average target price of $325.78.
Get Our Latest Stock Analysis on Union Pacific
About Union Pacific
Union Pacific Corporation (NYSE: UNP) is a transportation company that operates one of the largest freight railroad networks in the United States. Through its Union Pacific Railroad subsidiary, the company moves goods across the western two-thirds of the country, connecting major agricultural, industrial, energy, population and port markets.
Union Pacific transports a broad range of commodities and products, including agricultural goods, automotive shipments, chemicals, coal, industrial products, forest products and intermodal containers.
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