Union Pacific (UNP) AI Stock Analysis

• Market Cap: $139.53B
• Dividend Yield: 2.32%
• Average Volume (3M): 2.67M
• Price to Earnings (P/E): 19.6
• Beta (1Y): 0.64
• Revenue Growth: 1.06%
• EPS Growth: 8.21%
• Country: US
• Employees: 30,146
• Sector: Industrials
• Sector Strength: 72
• Industry: Railroads
• EPS (TTM): 2.86
• Shares Outstanding: 593,160,900
• 10 Day Avg. Volume: 3,748,683
• 30 Day Avg. Volume: 2,669,899
• PEG Ratio: 3.41
• Price to Book (P/B): 8.20
• Price to Sales (P/S): 5.71
• P/FCF Ratio: 23.51
• Enterprise Value/Market Cap: 1.25
• Enterprise Value/Revenue: 7.08
• Enterprise Value/Gross Profit: 15.42
• Enterprise Value/Ebitda: 13.59
• 1Y Price Target: $266.54
• Price Target Upside: 10.37% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14
• EPS Forecast (FY): 12.51
• Revenue Forecast (FY): $25.33B

• Rating: 68 Neutral
• Price Target: $252.00 ▲(4.35% Upside)

The score is driven primarily by strong profitability and operating efficiency, tempered by leverage and the steep decline in free-cash-flow growth. The earnings outlook is supportive (mid-single-digit EPS growth and OR improvement targets) but faces macro, cost, and merger-related uncertainty, while technicals are largely neutral and valuation is reasonable with a solid dividend.

Positive Factors

Merger with Norfolk Southern

The merger could significantly enhance Union Pacific's market position by creating a coast-to-coast network, improving service, and expanding market reach.

Operational Efficiency

Improved operational metrics indicate strong management and a focus on efficiency, which can sustain margins and profitability long-term.

Strong Profitability

High profit margins reflect efficient operations and pricing power, supporting long-term financial stability and growth potential.

Negative Factors

High Leverage

High leverage can limit financial flexibility and increase risk, potentially impacting future investments and stability if not managed carefully.

Decline in Free Cash Flow

Declining free cash flow growth may hinder the company's ability to fund operations, pay down debt, or invest in growth opportunities.

Legal Challenges to Merger

Legal challenges could delay or complicate the merger process, affecting strategic goals and creating uncertainty in execution.

Union Pacific Business Overview & Revenue Model

Company Description

Union Pacific Corporation, through its subsidiary, Union Pacific Railroad Company, operates in the railroad business in the United States. The company offers transportation services for grain and grain products, fertilizers, food and refrigerated products, and coal and renewables to grain processors, animal feeders, ethanol producers, and other agricultural users; petroleum, and liquid petroleum gases; and construction products, industrial chemicals, plastics, forest products, specialized products, metals and ores, soda ash, and sand, as well as finished automobiles, automotive parts, and merchandise in intermodal containers. As of December 31, 2021, its rail network included 32,452 route miles connecting Pacific Coast and Gulf Coast ports with the Midwest and Eastern United States gateways. The company was founded in 1862 and is headquartered in Omaha, Nebraska.

How the Company Makes Money

Union Pacific generates revenue primarily through freight transportation services, which includes the movement of bulk commodities, intermodal containers, and carload freight. The company operates on a volume-based pricing model, where revenue is earned based on the distance and weight of the cargo transported. Key revenue streams include shipments of agricultural products, coal, industrial goods, and consumer goods. Additionally, Union Pacific has partnerships with various logistics companies and offers integrated supply chain solutions, which enhance its service offerings and create additional revenue opportunities. The company also invests in infrastructure development and technology to improve operational efficiency, thereby maximizing profitability.

Union Pacific Financial Statement Overview

Summary

Strong profitability and margins (TTM gross margin ~45%, net margin ~28%; EBIT/EBITDA margins ~42%/~52%) support a high base score, but it is held back by high leverage (debt-to-equity 1.88) and a sharp TTM free cash flow growth decline (-74.14%) that raises cash durability risk.

Income Statement

Union Pacific demonstrates strong profitability with a consistent gross profit margin around 45% and a net profit margin near 28% in the TTM. The revenue growth rate of 0.63% in the TTM indicates stability, though not aggressive growth. EBIT and EBITDA margins are robust at 42% and 52% respectively, reflecting efficient operations. Overall, the income statement shows solid profitability and stable revenue growth.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 1.88 in the TTM, indicating significant leverage, which could pose risks if not managed carefully. However, the return on equity is strong at 42.4%, suggesting effective use of equity to generate profits. The equity ratio stands at 25.2%, indicating a moderate level of equity financing. Overall, while profitability is strong, the high leverage warrants caution.

Cash Flow

The cash flow statement shows a concerning decline in free cash flow growth by 74.14% in the TTM, which could impact future investments or debt repayments. The operating cash flow to net income ratio is 0.51, indicating moderate cash generation relative to net income. The free cash flow to net income ratio is 0.61, suggesting reasonable cash conversion. While cash generation is adequate, the decline in free cash flow growth is a notable weakness.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	24.55B	24.25B	24.12B	24.88B	21.80B	19.53B
Gross Profit	11.27B	11.04B	10.53B	11.21B	10.51B	9.18B
EBITDA	12.79B	12.50B	11.93B	12.64B	11.84B	10.33B
Net Income	7.05B	6.75B	6.38B	7.00B	6.52B	5.35B
Balance Sheet
Total Assets	68.65B	67.72B	67.13B	65.45B	63.52B	62.40B
Cash, Cash Equivalents and Short-Term Investments	808.00M	1.04B	1.07B	1.02B	1.01B	1.86B
Total Debt	32.85B	32.46B	34.18B	34.96B	31.49B	28.33B
Total Liabilities	51.34B	50.83B	52.34B	53.29B	49.36B	45.44B
Stockholders Equity	17.30B	16.89B	14.79B	12.16B	14.16B	16.96B
Cash Flow
Free Cash Flow	6.01B	5.89B	4.77B	5.74B	6.10B	5.61B
Operating Cash Flow	9.73B	9.35B	8.38B	9.36B	9.03B	8.54B
Investing Cash Flow	-3.69B	-3.33B	-3.67B	-3.47B	-2.71B	-2.68B
Financing Cash Flow	-6.16B	-6.07B	-4.63B	-5.89B	-7.16B	-4.90B

Union Pacific Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 241.49
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UNP, the sentiment is Positive. The current price of 241.49 is above the 20-day moving average (MA) of 230.55, above the 50-day MA of 231.86, and above the 200-day MA of 224.23, indicating a bullish trend. The MACD of 1.34 indicates Negative momentum. The RSI at 63.05 is Neutral, neither overbought nor oversold. The STOCH value of 90.77 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UNP.

Union Pacific Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CNR	72 Outperform	C$80.50B	17.28	22.24%	2.62%	0.23%	-13.22%
JBHT	69 Neutral	$20.16B	34.57	15.79%	0.89%	-1.60%	4.87%
UNP	68 Neutral	$139.53B	19.64	40.38%	2.32%	1.06%	8.21%
CP	68 Neutral	C$92.43B	22.75	8.88%	0.82%	4.02%	21.39%
NSC	68 Neutral	$71.32B	22.86	19.23%	1.85%	0.48%	22.88%
CSX	67 Neutral	$71.49B	24.89	22.52%	1.42%	-3.80%	-17.32%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Union Pacific Corporate Events

Union Pacific, Norfolk Southern File Application for Major Merger

On December 19, 2025, Union Pacific and Norfolk Southern jointly filed a nearly 7,000-page application with the Surface Transportation Board seeking approval to combine the two railroads, advancing a July 29, 2025 merger agreement aimed at creating America’s first transcontinental railroad. The companies say the end-to-end combination, supported by a record 2,000 stakeholder letters and 99% shareholder approval at both firms, would connect the U.S. from coast to coast, convert 10,000 lanes from interline to single-line service, and eliminate an estimated 2,400 rail car and container handlings and 60,000 car-miles per day, while retaining competitive options for almost all shared customer locations. The proposed merged network is framed as enhancing competition with long-haul trucking by shifting about 2 million truckloads a year to rail, boosting service to previously underserved “Watershed” regions, improving access to more than 100 ports, and reducing emissions through more efficient rail operations and fewer trucks on the road. For customers, the plan promises faster and more reliable single-line service, new intermodal and manifest train routes that cut transit times between Southern California and key eastern markets, improved asset utilization for railcar owners, and a unified digital platform with simplified contracts, invoicing and pricing, including a voluntary Committed Gateway Pricing system and alternative dispute resolution program. The railroads also emphasize safety and labor impacts, citing recent safety performance improvements, a joint safety integration plan developed with the Federal Railroad Administration, and commitments to protect all existing union jobs while expecting to add roughly 900 net new union positions by the third year after the merger, alongside about $2.1 billion in incremental capital investment and anticipated capital synergies.

The most recent analyst rating on (UNP) stock is a Buy with a $289.00 price target. To see the full list of analyst forecasts on Union Pacific stock, see the UNP Stock Forecast page.

Union Pacific Announces New Board Member Election

Union Pacific Corporation has announced the election of W. Anthony Will to its Board of Directors, effective January 5, 2026. Mr. Will, who will serve on the Board’s Audit and Finance Committees, is currently the President and CEO of CF Industries Holdings, Inc. and will retire from this role on January 4, 2026. His extensive experience in leadership roles at CF Industries and other companies positions him as a valuable addition to Union Pacific’s Board. The Board has determined that Mr. Will is independent and has no material relationship with the company, ensuring compliance with New York Stock Exchange listing standards.

The most recent analyst rating on (UNP) stock is a Hold with a $245.00 price target. To see the full list of analyst forecasts on Union Pacific stock, see the UNP Stock Forecast page.

Union Pacific Shareholders Approve Merger with Norfolk Southern

On November 14, 2025, Union Pacific Corporation held a special meeting where shareholders overwhelmingly approved the issuance of new shares in connection with the merger with Norfolk Southern Corporation, with 99.5% of votes cast in favor. This merger aims to create America’s first coast-to-coast railroad, enhancing service, growth, and innovation, and is subject to regulatory approval by the Surface Transportation Board.

The most recent analyst rating on (UNP) stock is a Buy with a $290.00 price target. To see the full list of analyst forecasts on Union Pacific stock, see the UNP Stock Forecast page.

Union Pacific Faces Legal Challenges in Merger Deal

On July 28, 2025, Union Pacific Corporation entered into a merger agreement with Norfolk Southern Corporation, aiming to integrate Norfolk Southern as a wholly owned subsidiary. The merger process involves two stages, with the first merger making Norfolk Southern a direct subsidiary of Union Pacific, followed by a second merger consolidating it under another subsidiary of Union Pacific. The merger has sparked legal challenges, with three lawsuits filed in New York Supreme Court and demand letters from shareholders alleging disclosure deficiencies. Despite these challenges, Union Pacific and Norfolk Southern are supplementing their joint proxy statement/prospectus to address the claims, although they believe the allegations are without merit.

The most recent analyst rating on (UNP) stock is a Buy with a $260.00 price target. To see the full list of analyst forecasts on Union Pacific stock, see the UNP Stock Forecast page.