Union Pacific Corp (UNP) stock analysis

P/E above its 5-year median

Union Pacific's P/E of 23.6 is above its own 5-year median of 21.3.

P/E above the industry

Union Pacific's P/E of 23.6 is above the Industrials median of 23.5.

EV/EBITDA above its 5-year median

Union Pacific's EV/EBITDA of 19.7 is above its 5-year median of 18.0.

P/B above the industry

Union Pacific's price-to-book of 8.16 is above the Industrials median of 2.40.

Trading above fair value

The share price of $302.44 is above our fair value estimate of $236.47.

Margin of safety under 20%

The price is 27.9% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew -0.5% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew 2.2% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 8.0% over the last twelve months, against a 5-year average of 5.9% a year.

Growing slower than the industry

Revenue grew 7.4% over the last twelve months; the Industrials median is 7.9%.

Guidance issued

The latest outlook (2026 Capital plan, Oct 22, 2026) was issued for the first time, so it neither adds nor takes away points.

Gross margin trend

This company does not report gross profit.

Return on equity over 15%

Return on equity was 38.7% over the last twelve months and averaged 45.1% over five years.

Return on capital over 10%

Return on invested capital was 16.5%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Union Pacific's return on equity of 38.7% is above the Industrials median of 6.1%.

Earnings grew over 5 years

Net income grew 5.9% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 28.9% over the last twelve months, against a 5-year average of 28.3%.

Net margin above the industry

Union Pacific's net margin of 28.9% is above the Industrials median of 2.5%.

High debt

Debt is 138% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 158% five years ago to 138%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 34.7% of total debt.

Interest well covered

Operating income covers interest expense 8.3 times.

Short-term assets cover short-term debts

Current assets are 1.16 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 4.39; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Union Pacific paid dividends worth 1.8% of the share price over the last twelve months.

Yield below Treasuries

The 1.8% yield is below the 4.7% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Union Pacific yields 1.8%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 43.3% of net income.

Covered by free cash flow

Dividends take 49.3% of free cash flow.