Jason Seidl, an analyst from TD Cowen, reiterated the Buy rating on Union Pacific (UNP – Research Report). The associated price target is $251.00.
Jason Seidl’s Buy rating for Union Pacific (UNP) is based on a mixture of elements including a strong fourth-quarter performance that surpassed expectations, and effective cost management strategies. In the fourth quarter, Union Pacific reported earnings per share that not only beat TD Cowen’s own forecast but also outdid the consensus estimate, largely due to better-than-anticipated volume growth. Additionally, the company demonstrated a significant decrease in workforce numbers, which contributed to a decrease in compensation and benefits expenses, leading to an impressive improvement in their operating ratio by 240 basis points sequentially.
Despite concerns about volume growth for the coming year, especially in the intermodal sector, and a cautious outlook from management, there are factors that could positively influence volumes, such as potential restrictions in the Panama and Suez Canals that might shift freight to the West Coast. Furthermore, Union Pacific’s commitment to controlling costs and improving margins was highlighted during their earnings call. This focus on what the company can control amidst uncertain volume forecasts and expected inflationary pressures not related to fuel costs, positions UNP as a stock with potential for investors, thus justifying the Buy rating.
In another report released yesterday, Bank of America Securities also reiterated a Buy rating on the stock with a $274.00 price target.
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Union Pacific (UNP) Company Description:
Founded in 1969, Nebraska-based Union Pacific Corp., through its principal subsidiary, Union Pacific Railroad Company, engages in railroad and freight transportation services. It offers transportation services for diversified business including agricultural products, food and beverage products, petroleum and gases, chemicals, coal, industrial products, intermodal and automotive.
Read More on UNP:
- Union Pacific Reports Fourth Quarter and Full Year 2023 Results
- Notable companies reporting before tomorrow’s open
- North American rail traffic down 13.5% for the week ending January 20
- UNP Earnings Report this Week: Is It a Buy, Ahead of Earnings?
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