UNP  Union Pacific Corporation

Exchange

NYSE

Sector

Transportation

Industry

Railroads

Market Cap.

86.34B

Vuru Grade

59.05/100

Current Price

$106.10
-2.170 (-1.993%)

Growth Price

$67.07
Overvalued by 36.78%

Stability Price

$1.66
Overvalued by 98.44%

Company Metrics

  • P/E 20.926
  • P/S 4.443
  • P/B 4.456
  • EPS 5.070
  • Cash ROIC 6.44%
  • Cash Ratio 0.37
  • Dividend 2.420 / 2.210 %
  • Avg. Vol. 3.79M
  • Shares 813.80M
  • Market Cap. 86.34B

Company Description

Union Pacific Corporation, through its subsidiary, Union Pacific Railroad Company, provides rail transportation services in North America. It has approximately 31,953 route miles linking Pacific Coast and Gulf Coast ports with the Midwest and eastern United States gateways, and provides several corridors to Mexican gateways. The company offers freight transportation services for agricultural produ... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Union Pacific Corporation (UNP) Ex-Dividend Date Scheduled for February 24, 2017
Nasdaq - 20 hours ago
Union Pacific Corporation ( UNP ) will begin trading ex-dividend on February 24, 2017. A cash dividend payment of $0.605 per share is scheduled to be paid on March 31, 2017.
Union Pacific Corporation Risk Points versus Transportation - CML News
Union Pacific (UNP) Up 3.4% Since Earnings Report: Can It Continue? - Yahoo Finance
Union Pacific Police Pursues Prestigious CALEA Accreditation
PR Newswire (press release) - 14 hours ago
23, 2017 /PRNewswire/ -- The Union Pacific Police Department is seeking public input as it pursues its third accreditation from the Commission on Accreditation for Law Enforcement Agencies, Inc. (CALEA), the national credentialing authority for law ...
Union Pacific Corporation CFO Rob Knight to Address the Stifel and Barclays ...
Union Pacific (press release) - Feb 7, 2017
From 2007-2016, Union Pacific invested approximately $34 billion in its network and operations to support America's transportation infrastructure.
What are Analyst's Indicators for Union Pacific Corporation (UNP), BB&T ... - The USA Commerce
Forward Earnings Estimate of Union Pacific Corporation(UNP)
Highland Mirror - Feb 23, 2017
Union Pacific Corporation(UNP): For the most recent quarter end, Union Pacific Corporation reported Annual Earnings of $1.39.
Option Market: Union Pacific Corporation Risk Hits A Deteriorated Level
CML News - 19 hours ago
We're going to look at a proprietary risk rating for the next 30-days built by Capital Market Laboratories (CMLviz) based on a large number of interactions of data points, many of which come directly from the option market for Union Pacific Corporation ...
Union Pacific - Delivering Shareholder Value
Seeking Alpha - Feb 13, 2017
Union Pacific (NYSE:UNP) announced a quality Q4 2016 earnings report to close out what was a very challenging year. The stock price's performance in 2016 was not reflective of those challenges, with the exception of Q4.
Union Pacific Tops Fortune's Most Admired in Industry
PR Newswire (press release) - Feb 16, 2017
Union Pacific Railroad is the principal operating company of Union Pacific Corporation (NYSE: UNP). One of America's most recognized companies, Union Pacific Railroad connects 23 states in the western two-thirds of the country by rail, providing a ...
Looking at the Tea Leaves for Union Pacific Corporation (UNP)
The USA Commerce - 18 hours ago
We have gathered the technical data on Union Pacific Corporation (UNP), and see some interesting trends in the stock's behavior of late.
Union Pacific vs. CSX Earnings: How Do They Stack Up?
Motley Fool - Jan 27, 2017
A quick look at the stock charts of railroads Union Pacific Corporation (NYSE:UNP) and CSX Corporation (NASDAQ:CSX) would suggest the latter had a much weaker fourth quarter than its peer, but that doesn't tell the whole story.
Union Pacific Employees Achieve Safest Year in Company History - Union Pacific (press release)
Taking a Fresh Look at Union Pacific Corporation (UNP)
StockNewsJournal - Feb 22, 2017
Union Pacific Corporation (UNP) is an interesting player in the Services space, with a focus on Railroads. The stock has been active on the tape, currently trading at $109.67, down from yesterday's close by -0.14%.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for UNP to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate UNP's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$106.10 Current Price

$67.07 Growth Price (DCF)

Overvalued by 36.78%


Growth Rate Assumed by Market: 23.07%


Future Free Cash Flow Growth Rate: 7.4%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$1.66 Stability Price (EPV)

Overvalued by 98.44%


Discount Rate: 15.0%

$86.96 Book Price

Overvalued by 18.04%


Poor Cash Return on Invested Capital over the past 5 years

UNP has been unable to consistently generate sufficient returns from its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

UNP has only created $6.44 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20122013201420152016
Free Cash Flow 2.15B 3.33B 3.04B 2.69B 4.02B
divided by
Invested Capital 42.97B 44.51B 47.37B 50.00B 50.74B
Cash ROIC 5.00% 7.48% 6.42% 5.39% 7.92%

Excellent Return on Equity over the past 5 years

Over the past 5 years, UNP has generated strong profits with money shareholders have invested. This is considered one of the best indicators of quality management. Beware of extremely high Return on Equity (> 50%) as this is often unsustainable.

UNP has generated $21.85 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20122013201420152016
Net Income 3.94B 4.39B 5.18B 4.77B 4.23B
divided by
Stockholders' Equity 19.88B 21.23B 21.19B 20.70B 19.93B
Return on Equity 19.84% 20.67% 24.45% 23.05% 21.24%

Excellent Business Performance over the past 10 years

UNP has been able to maintain profitability in good times and bad. This could mean UNP has an extremely strong business or has the ability to scale down costs when needed. This should be a fairly resilient business, but double check for future sustainability by looking at its Risk Factors in the Annual Report.

UNP has created positive free cash flow for 9 or more of the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow 781.00M 1.29B 3.13B 4.11B 5.79B 2.15B 3.33B 3.04B 2.69B 4.02B

Weak Balance Sheet

UNP's financial position is not ideal. The key is to check whether UNP is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash 878.00M 1.25B 1.85B 1.09B 1.22B 1.06B 1.43B 1.59B 1.39B 1.34B
Current Assets 2.59B 2.81B 3.68B 3.43B 3.73B 3.61B 3.99B 4.68B 4.13B 3.60B
Total Assets 38.03B 39.72B 42.41B 43.09B 45.10B 47.15B 49.73B 52.72B 54.60B 55.72B
Current Liabilities 3.04B 2.88B 2.68B 2.95B 3.32B 3.12B 3.79B 3.77B 3.21B 3.64B
Total Liabilities 22.45B 24.28B 25.47B 25.33B 26.52B 27.28B 28.51B 31.53B 33.90B 35.79B
Stockholder' Equity 15.59B 15.45B 16.94B 17.76B 18.58B 19.88B 21.23B 21.19B 20.70B 19.93B
Current Ratio 0.85 0.98 1.37 1.16 1.12 1.16 1.05 1.24 1.29 0.99
TL-to-TA 0.59 0.61 0.60 0.59 0.59 0.58 0.57 0.60 0.62 0.64

Consistent Reinvestment of Profits over the past 10 years

UNP has consistently retained profits. This may put UNP in a strong position to invest for the future, by buying new machinery, investing in R&D or a number of other options. By effectively using these earnings, UNP can greatly improve their long-term economic picture.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings 12.67B 13.81B 15.17B 17.15B 19.51B 22.27B 25.29B 27.37B 30.23B 32.59B
Retained Earnings Growth - 9.05% 9.80% 13.10% 13.72% 14.16% 13.55% 8.22% 10.47% 7.79%

Growing Competitive Advantage over the past 10 years

UNP has a growing competitive advantage. This could be due to strong branding, the ability to keep costs low, or some other characteristic that is hard to replicate. Look at its future prospects to determine sustainability and whether the economic moat will continue to strengthen.

$17.46 of every $100 of Revenue have been pure profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income 1.86B 2.34B 1.90B 2.78B 3.29B 3.94B 4.39B 5.18B 4.77B 4.23B
divided by
Revenue 16.28B 17.97B 14.14B 16.97B 19.56B 20.93B 21.96B 23.99B 21.81B 19.94B
Net Profit Margin 11.39% 13.01% 13.42% 16.39% 16.83% 18.84% 19.98% 21.59% 21.88% 21.23%

Strong Pricing Power over the past 10 years

UNP has maintained substantial gross margins, suggesting that they have been able to set prices without consideration of the cost of goods sold. This potentially leaves flexibility in inflationary environments to raise prices on consumers and maintain profitability.

$73.27 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit 11.03B 12.09B 10.77B 12.64B 13.97B 15.18B 16.11B 17.89B 17.38B 15.06B
divided by
Revenue 16.28B 17.97B 14.14B 16.97B 19.56B 20.93B 21.96B 23.99B 21.81B 19.94B
Gross Margin 67.75% 67.25% 76.12% 74.52% 71.44% 72.52% 73.37% 74.58% 79.67% 75.51%

High Capital Intensity over the past 10 years

UNP spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

78.54% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure 2.50B 2.78B 100.00M - 85.00M 4.01B 3.50B 4.35B 4.65B 3.51B
divided by
Net Income 1.86B 2.34B 1.90B 2.78B 3.29B 3.94B 4.39B 5.18B 4.77B 4.23B
Capital Expenditure Ratio 134.56% 118.91% 5.27% - 2.58% 101.75% 79.67% 83.90% 97.44% 82.80%

Very Strong Dividend History over the past 10 years

UNP has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests UNP is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid 364.00M 481.00M 544.00M 602.00M 837.00M 1.15B 1.33B 1.63B 2.34B 1.88B
divided by
Shares Outstanding 536.80M 515.00M 505.80M 502.90M 489.80M 953.00M 931.60M 901.10M 869.40M 835.40M
Dividend Paid Per Share 0.68 0.93 1.08 1.20 1.71 1.20 1.43 1.81 2.70 2.25
Price at Year End 58.97 43.88 62.14 89.72 105.38 123.54 166.05 120.25 78.51 103.68
Dividend Yield 1.15% 2.13% 1.73% 1.33% 1.62% 0.97% 0.86% 1.51% 3.43% 2.17%

Strong History of Stock Buybacks over the past 10 years

UNP has a strong history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 536.80M 515.00M 505.80M 502.90M 489.80M 953.00M 931.60M 901.10M 869.40M 835.40M
Stock Bought Back - 4.23% 1.82% 0.58% 2.67% -48.60% 2.30% 3.38% 3.65% 4.07%
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