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With a market cap of $150.2 billion, Union Pacific Corporation (UNP) is the largest railroad in North America, providing freight transportation across 23 U.S. states through its subsidiary, Union Pacific Railroad Company. The company connects major ports, industrial hubs, and international rail networks while transporting agricultural products, automotive goods, chemicals, and other commodities.
Shares of the major freight rail system operator have lagged behind the broader market over the past 52 weeks. UNP has risen 1.6% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 23%. However, shares of UNP are up 9.4% on a YTD basis, outpacing SPX’s 3.6% gain.
Focusing more closely, the Omaha, Nebraska-based company has underperformed the Industrial Select Sector SPDR Fund’s (XLI) 18.7% return over the past 52 weeks.
Shares of Union Pacific surged 5.2% on Jan. 23 after the company reported Q4 2024 EPS of $2.91, surpassing analyst expectations and marking a 7.4% year-over-year increase. Despite a slight revenue miss at $6.1 billion, investors focused on operational improvements, including a 6% increase in car miles per employee and enhanced freight car velocity. Additionally, management’s bullish outlook for 2025, featuring a $4.5 billion share repurchase plan and a capital expenditure target of $3.4 billion, reinforced investor confidence, driving the stock higher.
For the current fiscal year, ending in December 2025, analysts expect UNP’s EPS to grow 8.3% year-over-year to $12.01. The company's earnings surprise history is mixed. It topped the consensus estimates in three of the last four quarters while missing on another occasion.
Among the 25 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on 14 “Strong Buy” ratings, one “Moderate Buy,” nine “Holds,” and one “Strong Sell.”
On Jan. 24, Baird raised Union Pacific’s price target to $265, maintaining an “Outperform” rating.
As of writing, UNP is trading below the mean price target of $264.32. The Street-high price target of $285 implies a potential upside of 14.3% from the current price levels.
