Union Pacific (UNP) — Company Research
Last Updated: 17 July 2026
Union Pacific is the largest freight railroad in the western two-thirds of the United States, operating a 32,889 route-mile network across 23 states that links Pacific Coast and Gulf Coast ports with the Midwest and eastern gateways. In 2025 the company generated $24.51bn of operating revenue and reported diluted EPS of $11.98, running one of the industry's best operating ratios near 60%. The dominant question for investors today is its pending $85bn merger with Norfolk Southern, which would create the first single-line coast-to-coast railroad in the US and is currently under Surface Transportation Board review. This report examines the business, its financial trend, valuation and the bull and bear arguments. Live pricing is on our Live Charts page and scheduled catalysts on the Economic Calendar.
1. Company Snapshot
| Field | Value |
|---|---|
| Company | Union Pacific Corporation |
| Ticker / Exchange | UNP (NYSE) |
| Sector | Industrials — Railroads / Freight Transport |
| CEO / Leadership | Vincenzo (Jim) Vena (Chief Executive Officer); Jennifer Hamann (CFO) |
| Employees | ~29,300 (2025 year-end) |
| Network | 32,889 route miles across 23 states |
| Headquarters | Omaha, Nebraska, USA |
| Market cap | ~$171bn (15 Jul 2026) |
| Share price | ~$288 (mid-Jul 2026) |
| Revenue (FY2025) | $24.51bn |
| GAAP diluted EPS (FY2025) | $11.98 |
| Adjusted EPS (FY2025) | $11.66 |
| Dividend / share (FY2025 declared) | $5.44 |
| Next earnings | 23 Jul 2026 (Q2 2026) |
2. Bull vs Bear
Bull Case
- Transformational merger optionality: The proposed combination with Norfolk Southern would create the first US transcontinental single-line railroad, with management targeting roughly $2.75bn of annual synergies and EPS accretion building from Year 2.
- Best-in-class operations: Union Pacific posted record first-quarter revenue, income and efficiency in 2026 with an operating ratio around 60%, reflecting disciplined precision-scheduled railroading and pricing power.
- Wide, irreplaceable moat: Its network is effectively a duopoly with BNSF in the western US; the right-of-way and infrastructure could not realistically be rebuilt, giving durable pricing and volume defensibility.
- Reliable capital returns: The company has raised its dividend for nearly two decades and generates strong free cash flow, with a $5.44 per-share dividend declared in 2025.
- Volume and share recovery: Coast-to-coast single-line service, if approved, could win freight from trucking and interline routings, adding a structural volume driver on top of pricing.
Bear Case
- Merger regulatory risk: The STB accepted the application but held proceedings in abeyance and demanded more information; approval is not assured, could carry conditions, and the deal would not close before 2027.
- Buybacks suspended: Both companies plan to pause share repurchases through 2028 to fund the deal, removing a major lever that had supported EPS growth.
- Cyclical, trade-sensitive volumes: Freight demand tracks the industrial economy and global trade; tariffs, a recession or weak intermodal could pressure carloads.
- Secular coal decline: Coal and some bulk categories face structural decline, a persistent headwind to volume mix.
- Integration and leverage: Absorbing an $85bn acquisition brings execution risk, a heavier debt load and years of integration complexity.
3. Business Segments
Union Pacific reports freight revenue in three commodity groups plus other revenue. Percentages below are shares of total 2025 operating revenue of $24.51bn.
| Segment | % of revenue | What it is |
|---|---|---|
| Industrial | ~35% ($8.60bn) | Construction, industrial chemicals, plastics, forest products, metals and ores, petroleum, LPG, soda ash and sand |
| Bulk | ~31% ($7.59bn) | Grain and grain products, fertiliser, food and refrigerated, coal and renewables |
| Premium | ~28% (~$6.9bn) | Automotive (finished vehicles and parts) and intermodal container traffic |
| Other | ~6% (~$1.4bn) | Accessorial, subsidiary and other operating revenue not tied to freight carloads |
4. Business Model & Moat
How it makes money. Union Pacific earns revenue hauling freight by rail, charging per carload or container based on commodity, distance and service. Profitability is driven by volume, pricing and cost efficiency, tracked through the operating ratio (operating expense divided by revenue); a lower ratio means more of every revenue dollar becomes profit. In 2025 the operating ratio ran near 60%, among the best in the industry.
Why the moat is durable. The network is a physical asset that cannot be replicated: building a competing transcontinental right-of-way is economically and politically impossible. In the western US, Union Pacific and BNSF form an effective duopoly, giving both strong pricing power. High fixed costs and dense traffic create scale advantages that favour incumbents.
Where it is vulnerable. Railroads are capital-intensive and cyclical, tied to industrial output and trade flows. Trucking competes for time-sensitive freight, and regulation, labour agreements and fuel prices all shape margins. The pending Norfolk Southern merger could reshape the competitive map, for better or worse.
5. Financial Health
All figures below are drawn from Union Pacific's SEC filings (10-K, 10-Q) and quarterly earnings press releases.
| Fiscal Year | Revenue ($m) | YoY % | GAAP EPS | Adjusted EPS | Dividend/share | Long-term debt ($m, YE) |
|---|---|---|---|---|---|---|
| FY2021 | 21,804 | +11.6% | $9.95 | $9.95 | $4.29 | 29,729 |
| FY2022 | 24,875 | +14.1% | $11.21 | $11.21 | $5.08 | 33,326 |
| FY2023 | 24,119 | −3.0% | $10.45 | $10.45 | $5.20 | 32,579 |
| FY2024 | 24,250 | +0.5% | $11.09 | $11.09 | $5.28 | 31,192 |
| FY2025 | 24,510 | +1.1% | $11.98 | $11.66 | $5.44 | 31,814 |
For years 2021–2024 Union Pacific reported no material non-GAAP adjustments, so the adjusted column equals GAAP EPS. FY2025 adjusted EPS of $11.66 excludes roughly $0.30 of net-of-cost industrial-park land-sale gains and about $0.05 of Norfolk Southern merger costs versus reported EPS of $11.98.
Quarterly detail (most recent first), with a bold full-year 2025 total.
| Quarter | Revenue ($m) | Adjusted EPS | GAAP EPS |
|---|---|---|---|
| Q1 2026 | 6,217 | $2.93 | $2.87 |
| Q4 2025 | 6,244 | $2.86 | $3.11 |
| Q3 2025 | 6,154 | $3.08 | $3.01 |
| Q2 2025 | 6,091 | — | $2.75 |
| FY2025 total | 24,510 | $11.66 | $11.98 |
At year-end 2025 the balance sheet carried about $30.3bn of non-current long-term debt plus $1.5bn current maturities (roughly $31.8bn total), against $1.27bn of cash. Full-year operating cash flow was $9.29bn and capital expenditure $3.79bn, giving free cash flow of about $5.5bn.
6. Valuation
Raw metrics, July 2026. Not opinions on whether the stock is cheap or expensive.
| Metric | Value |
|---|---|
| Market cap | ~$171bn (15 Jul 2026) |
| Enterprise value | ~$202bn (market cap ~$171bn + total debt ~$31.8bn − cash ~$1.3bn per FY2025 balance sheet) |
| Trailing P/E (GAAP) | ~24x (price ~$288 / TTM GAAP EPS ~$12.15, i.e. FY2025 $11.98 − Q1 2025 $2.70 + Q1 2026 $2.87) |
| P/E (forward) | ~23x (price ~$288 / FY2026 EPS ~$12.6, from management's guided mid-single-digit EPS growth off FY2025 $11.98) |
| P/S (TTM) | ~6.9x (market cap ~$171bn / TTM revenue ~$24.7bn) |
| EV/EBITDA (TTM) | ~16x (EV ~$202bn / FY2025 EBITDA ~$12.3bn; EBITDA = operating income $9.85bn + D&A $2.49bn per cash flow statement) |
| P/FCF | ~31x (market cap ~$171bn / FCF ~$5.5bn; FCF = operating cash flow $9.29bn − capex $3.79bn per FY2025 cash flow statement) |
| 52-week high | $300.06 |
| 52-week low | $210.84 |
| Short interest (% of float) | ~1.6% (Fintel/MarketBeat, latest 2026 reading; ~10m shares) |
| Days to cover | ~3.2 days |
7. What Are They Building
Union Pacific's defining project is the proposed merger with Norfolk Southern, announced in July 2025 and valuing NS at roughly $85bn, or about $320 per share (one UP share plus $88.82 in cash per NS share). Management frames the combination as America's first transcontinental single-line railroad, spanning more than 50,000 miles across 43 states and connecting about 100 North American ports. The stated prize is roughly $2.75bn of annual synergies from new revenue and productivity, with adjusted-EPS accretion beginning early in Year 2 and building thereafter. Over 99% of both companies' shareholders approved the deal in November 2025.
Beyond the merger, Union Pacific continues to invest in its network through a capital plan of about $3.3bn a year, funding track, locomotives, technology and capacity to improve safety, velocity and fuel efficiency. The near-term operational agenda is service reliability and pricing discipline while the regulatory process runs its course, with the company affirming a 2026 outlook for mid-single-digit EPS growth and further operating-ratio improvement.
8. Peer Comparison
| Peer | Market cap (Jul 2026) | Key 2025 metric |
|---|---|---|
| Union Pacific (UNP) | ~$171bn | FY2025 revenue $24.51bn |
| CSX (CSX) | ~$92bn | FY2025 revenue $14.1bn |
| Canadian Pacific Kansas City (CP) | ~$78bn | FY2025 revenue C$15.07bn |
| Norfolk Southern (NSC) | ~$74bn | FY2025 revenue $12.18bn |
| Canadian National (CNI) | ~$74bn | FY2025 revenue C$17.7bn |
9. Insider Activity
| Name | Date | Type | Shares | Price | Value | Plan Type |
|---|---|---|---|---|---|---|
| Vincenzo J. Vena (CEO) | 13 Apr 2026 | Acquire (ESPP) | ~12 | $250.51 | ~$3,000 | Employee Stock Purchase Plan |
Insider activity has been limited to routine equity-compensation transactions rather than large open-market trades; CEO Jim Vena acquired a small number of shares through the employee stock purchase plan and directly held about 220,695 shares afterward. No material insider open-market purchases or sales were reported in the period.
10. Key Risks
- Merger regulatory outcome (Regulatory): The STB review is in abeyance pending supplemental information; the deal could be delayed, conditioned or rejected, and much of the current investment thesis hinges on approval.
- Integration and financing (Financial/Operational): Absorbing an $85bn acquisition would add debt and multi-year integration complexity, with synergy delivery uncertain.
- Freight-volume cyclicality (Macro): Carloads track industrial production and trade; a downturn, tariffs or weak intermodal would pressure revenue.
- Secular coal decline (Operational): Structural erosion in coal and some bulk categories is a persistent volume headwind.
- Labour relations (Operational): Around 85% of the workforce is unionised across 13 major rail unions; disputes or work rules can affect cost and service.
- Suspended buybacks (Financial): Pausing repurchases through 2028 removes a key EPS-support mechanism during the merger period.
- Fuel and service risk (Macro/Operational): Fuel-price swings and any service disruption directly affect the operating ratio and customer retention.
11. Recent Developments
- 25 Jun 2026 — Q2 earnings date set. Union Pacific announced it would report second-quarter 2026 results on 23 July 2026, with a conference call the same morning.
- 28 May 2026 — STB accepts merger application, pauses review. The Surface Transportation Board accepted the Union Pacific–Norfolk Southern application for consideration but held proceedings in abeyance, requesting supplemental information due by 27 July 2026.
- 30 Apr 2026 — Revised merger application filed. The companies submitted a revised joint application after the STB had earlier deemed the January filing incomplete.
- 23 Apr 2026 — Record Q1 2026 results. Operating revenue rose 3% to $6.22bn with diluted EPS up 6% to $2.87 and an operating ratio of 60.5%; management affirmed its 2026 outlook.
- 27 Jan 2026 — Q4 and full-year 2025 results. Full-year net income was $7.1bn (EPS $11.98, up 8%); Q4 EPS of $3.11 included land-sale gains and merger costs.
12. Key Dates
- 23 Jul 2026 — Q2 2026 results at 7:45 a.m. ET, with conference call at 8:45 a.m. ET
- 27 Jul 2026 — deadline for the UP/NS supplemental information filing to the STB
- 22 Oct 2026 — expected Q3 2026 results (provisional, based on prior-year cadence)
- 31 Mar 2027 — management's targeted window for merger completion (early-to-mid 2027, subject to STB approval)
For scheduled economic releases and earnings, use the ChartsView Economic Calendar, and share views on the Forum.
Disclaimer: This research is produced by ChartsView for educational and informational purposes only. It does not constitute financial advice or a recommendation to buy or sell any security. All information is sourced from publicly available company filings, press releases, and official data. ChartsView does not use analyst opinions or third-party ratings. Always conduct your own due diligence and consider your personal financial situation before making investment decisions. Past performance is not indicative of future results.
Loading research report…
13. Thesis Verdict
The central thesis. Union Pacific is the largest freight railroad in the western United States, earning revenue per carload and container across a 32,889-mile network with an industry-leading operating ratio near 60%. Full-year 2025 operating revenue was $24.51bn with diluted EPS of $11.98 (adjusted $11.66), and management has affirmed a 2026 outlook of mid-single-digit EPS growth and further margin improvement. The defining catalyst is the proposed roughly $85bn merger with Norfolk Southern to create America's first single-line transcontinental railroad, targeting about $2.75bn of annual synergies.
What would confirm or break it. Confirmation would come from the 23 July 2026 Q2 report sustaining record operating metrics and from Surface Transportation Board progress toward approving the Norfolk Southern combination. The thesis breaks if the STB rejects or heavily conditions the merger, if freight volumes weaken with the industrial cycle or coal decline, or if the buyback suspension through 2028 and rising leverage undercut per-share growth.
Watchpoints
- ConfirmsQ2 2026 earnings (6 days) landing in line with or above management guidance.
- ConfirmsEvidence supporting the "Transformational merger optionality:" thesis continuing to build across subsequent filings.
- InvalidatesMaterialisation of the "Merger regulatory outcome (Regulatory):" risk, or any disclosure that fundamentally alters the capital-return or growth profile stated by management.
Diagnostic grid
Generated by ChartsView research tooling. Thesis strength measures how well the evidence in this report supports the company's stated thesis — it is NOT a buy/sell rating or price target. ChartsView is not authorised by the FCA to provide regulated investment advice. Generated 17 Jul 2026.