Union Pacific (UNP) Dips More Than Broader Markets: What You Should Know

September
3, 2021

3 min read

This story originally appeared on Zacks

Union Pacific (UNP) closed the most recent trading day at $214.91, moving -1.2% from the previous trading session. This move lagged the S&P 500’s daily loss of 0.03%.

Heading into today, shares of the railroad had lost 0.74% over the past month, lagging the Transportation sector’s gain of 4.41% and the S&P 500’s gain of 3.59% in that time.

Wall Street will be looking for positivity from UNP as it approaches its next earnings report date. The company is expected to report EPS of $2.60, up 29.35% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $5.53 billion, up 12.47% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $10.02 per share and revenue of $21.64 billion. These totals would mark changes of +22.34% and +10.79%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for UNP. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. UNP is currently sporting a Zacks Rank of #2 (Buy).

Investors should also note UNP’s current valuation metrics, including its Forward P/E ratio of 21.71. This represents a discount compared to its industry’s average Forward P/E of 21.92.

Also, we should mention that UNP has a PEG ratio of 2.17. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. The Transportation – Rail industry currently had an average PEG ratio of 2.17 as of yesterday’s close.

The Transportation – Rail industry is part of the Transportation sector. This industry currently has a Zacks Industry Rank of 219, which puts it in the bottom 14% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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