Union Pacific Corporation

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  • Aug. 20, 2015, 10:11 AM
    • Believing the company will be pressured by declining coal volumes and that its valuation still isn't cheap, Macquarie's Cleo Zagrean has downgraded Union Pacific (UNP -2.4%) to Neutral.
    • Zagrean: "We now no longer expect that UNP will be able to achieve its 60+/- by full year '19 OR target ahead of time, and see further downside to our growth outlook if in fact more than 50% of the upcoming gas capacity translates into coal displacement rather than feeding new electric demand growth." 2016 and 2017 estimates have been cut by 2%-4%.
    • At the same time, Zagrean has upgraded Kansas City Southern (KSU -0.8%) to Outperform, arguing it's the only railroad still seeing double-digit growth. "KSU becomes our top pick in US rail given the superior growth profile in a space where we continue to see mid single digit downside to LT EPS expectations. We would also pair KSU long against UNP short or GWR short given the potential for earnings surprises and the relative resilience of valuation multiples." His 2017 EPS estimate has been raised by 2%.
    | Aug. 20, 2015, 10:11 AM | 7 Comments
  • Aug. 10, 2015, 6:54 AM
    • A majority of railroads will fall short of meeting a deadline of the end of the year to install PTC technology, warns the Federal Railroad Administration.
    • Companies could be assessed "substantial" fines if the deadline to install positive train control systems isn't completed on time.
    • Related stocks: CSX, GWR, KSU, CP, UNP, CSX, CNI, PWX, OTCPK:PRRR.
    | Aug. 10, 2015, 6:54 AM | 11 Comments
  • Aug. 7, 2015, 5:54 PM
    • Rail traffic fell in July from a year ago as an increase in container volumes could not offset a sharp decline in oil and coal shipments, according to the latest monthly report from the Association of American Railroads.
    • The number of carloads carrying oil and petroleum products fell 13.6% Y/Y to 67.9K last month, while coal volumes sank 12.5%; container shipments rose 3.8% to 1.2M, and traffic overall fell 1.8% to 2.7M.
    • "Railroads are overexposed, relative to the economy in general, to the energy sector,” the AAR says in its traffic report.
    • Relevant tickers: CSX, NSC, UNP, KSU, BRK.A, BRK.B
    | Aug. 7, 2015, 5:54 PM | 24 Comments
  • Jul. 30, 2015, 10:18 AM
    • Union Pacific (NYSE:UNP) declares $0.55/share quarterly dividend, in line with previous.
    • Forward yield 2.26%
    • Payable Sept. 30; for shareholders of record Aug. 31; ex-div Aug. 27.
    | Jul. 30, 2015, 10:18 AM
  • Jul. 23, 2015, 5:58 PM
    • Union Pacific (NYSE:UNP) fell 5.7% in today's trade, becoming the latest rail company to suffer from sharp declines in coal traffic when it announced a nearly 10% Y/Y drop in Q2 revenues, including a 31% slump in coal revenues to $679M.
    • The volume of coal carried in the quarter fell 26%, pushing overall volumes down 6%, UNP said.
    • Last week, CSX, the main railroad in the eastern U.S., reported an 11% drop in Q2 coal revenues and a 15% decline in traffic.
    • UNP, which operates in the western two-thirds of the U.S., suffered particularly heavily because its main coal traffic is low-quality coal from the Powder River Basin, which is used mainly for electricity generation; much of the coal traffic for CSX and Norfolk Southern (NYSE:NSC), which operate east of the Mississippi, is high-quality metallurgical coal used in steel production.
    • UNP said its crude oil traffic for Q2 fell 29% to 25.2K carloads.
    | Jul. 23, 2015, 5:58 PM | 17 Comments
  • Jul. 23, 2015, 8:03 AM
    • Union Pacific (NYSE:UNP): Q2 EPS of $1.38 beats by $0.03.
    • Revenue of $5.43B (-9.8% Y/Y) misses by $170M.
    | Jul. 23, 2015, 8:03 AM | 18 Comments
  • Jul. 22, 2015, 5:44 PM
    • Orders for railroad tank cars during Q2 fell 29% Q/Q and 70% Y/Y, reflecting a broad decline in energy shipments at railroads.
    • Carload volume for oil and petroleum products for the week ended July 18 was down 20% from last year and off 2.7% in the first 28 weeks of 2015 from the same period in 2014.
    • Kansas City Southern (NYSE:KSU) recently reported a 46% decline in energy shipments, and Canadian Pacific (NYSE:CP) said Q2 revenue from crude oil shipping tumbled 29% Q/Q.
    • Other relevant tickers: CSX, NSC, UNP, CNI, BRK.A, BRK.B, GBX, WAB, TRN, ARII, RAIL
    | Jul. 22, 2015, 5:44 PM | 31 Comments
  • Jul. 16, 2015, 6:51 PM
    • Barclays downgrades the North American air freight and ground transportation sector to Neutral from Positive, after having been bullish on transports the past year, citing incrementally softer industrial demand, challenging commodity markets, high relative inventories and significant U.S. dollar appreciation.
    • Barclays downgrades Canadian National (NYSE:CNI) and Norfolk Southern (NYSE:NSC) to Equal Weight from Overweight; it says CNI maintains ~10% revenue exposure to direct energy markets such as crude oil, frac sand and drilling pipe, while softening eastern coal volumes to continue to be “a significant earnings headwind” for NSC.
    • The firm also cuts Kansas City Southern (NYSE:KSU) to Underweight from Equal Weight in response to lowered outlooks, relatively high valuation vs. benchmark Union Pacific (NYSE:UNP) and company-specific execution risks.
    | Jul. 16, 2015, 6:51 PM | 4 Comments
  • Jul. 14, 2015, 9:29 AM
    • Earnings season for the railroad sector launches tonight when CSX Corp. reports with expectations EPS will be flat compared to a year ago at $0.53.
    • The company lowered its guidance in April to single-digit earnings growth for the full year in a shot heard across the sector.
    • Freight traffic has been in decline due to lower shipments of crude oil, coal, and grains, although some analysts have forecast increased demand for consumer goods could help to offset trends in the energy market.
    • Today's big miss in retail sales doesn't bode particularly well for that line of thought.
    • Railroad stocks: UNP, NSC, CSX, CNI, ARII, GBX, CP, KSU, CNI, WAB, TRN.
    • CSX earnings preview
    | Jul. 14, 2015, 9:29 AM | 12 Comments
  • Jul. 2, 2015, 11:57 AM
    • Union Pacific (UNP +0.5%) told investors this week it will impose a $1,200 per-car surcharge on oil shippers that move crude in older railcars, becoming at least the second U.S. railroad to charge extra amid widespread safety concerns, according to a Reuters report.
    • In a revised tariff taking effect Aug. 1, UNP posted rates that will charge shippers more if they use DOT-111 railcars, which are not as strong as cars built to a higher standard the industry adopted in October 2011.
    • For DOT-111s carrying an average of 700 barrels of crude per car, a $1,200 surcharge would add an additional cost of $1.71 per barrel shipped.
    • Earlier this year, BNSF imposed a similar $1,000 per DOT-111 surcharge on shippers.
    | Jul. 2, 2015, 11:57 AM | 10 Comments
  • May 21, 2015, 5:15 PM
    • The Association of American Railroads says crude oil carried by big U.S. railroads fell nearly 14% Q/Q to ~113K carloads as oil companies cut back domestic shipments.
    • Industry execs have cautioned that lower oil prices could end up slowing volume growth this year because the low prices will not support Bakken Shale crude, which is more expensive to extract and ship than other oil.
    • Although total rail cargo volumes have continued to come in below expectations, Morgan Stanley analysts say a rally in energy prices could help boost railroad stock prices.
    • Relevant tickers: CSX, NSC, UNP, KSU, BRK.A, BRK.B
    | May 21, 2015, 5:15 PM | 9 Comments
  • May 20, 2015, 6:41 PM
    • Union Pacific's (NYSE:UNP) coal shipments are down 25% so far in Q2 and the company does not foresee much improvement for the rest of the period, CFO Robert Knight Jr. warned today, in a much steeper decline than the single digits UNP execs had expected last month.
    • At a transportation industry conference, Knight attributed the weak coal shipments to low natural gas prices and mild weather.
    • The CFO also said UNP's Q2 performance still will reflect the effects of operating efficiencies despite furloughing additional employees and placing more locomotives back in storage.
    | May 20, 2015, 6:41 PM | 10 Comments
  • May 14, 2015, 10:34 AM
    • Union Pacific (NYSE:UNP) declares $0.55/share quarterly dividend, in line with previous.
    • Forward yield 2.15%
    • Payable June 30; for shareholders of record May 29; ex-div May 27.
    | May 14, 2015, 10:34 AM | 12 Comments
  • May 14, 2015, 10:04 AM
    • Railroad stocks are tilting lower after Kansas City Southern pulls its 2015 guidance at an investor conference.
    • Investors are taking a cautious approach to Union Pacific (UNP -0.3%), Genesee & Wyoming (GWR -2.2%), Norfolk Southern (NSC -0.6%), CSX Corporation (CSX -0.1%), Canadian National Railway (CNI -0.5%), and Canadian Pacific (CP -0.3%) off the warning from Kansas Southern.
    • Safety concerns also continue to linger in the sector which is seen as a development that could put some pressure on spending and investments.
    • Previously: Kansas City Southern -3% after pulling guidance
    | May 14, 2015, 10:04 AM | 27 Comments
  • May 13, 2015, 11:24 AM
    • The U.S. oil industry is challenging new rules aimed at improving the safety of moving crude oil by rail, as the American Petroleum Institute petitions the U.S. Court of Appeals for the D.C. Circuit to block key provisions of rules unveiled earlier this month.
    • The petition seeks to block a requirement that older tank cars be retrofitted with new safety features designed to prevent them from spilling oil or rupturing in a derailment, and challenges a requirement that tank cars be equipped with new electronic braking systems or face operational restrictions.
    • Environmental groups say the new rules do not go far enough, and are considering their own legal challenge.
    • Relevant tickers: CSX, NSC, UNP, CNI, CP, KSU, BRK.A, BRK.B, GBX, WAB, TRN, ARII, RAIL
    | May 13, 2015, 11:24 AM | 21 Comments
  • May 5, 2015, 5:43 PM
    • Norfolk Southern (NYSE:NSC) CEO Wick Moorman says the rail industry will challenge the U.S. government’s new crude-by-rail regulations, worried that the new rules could make shipping crude oil by train prohibitively expensive.
    • The Department of Transportation last Friday called for the installation of new braking systems on trains hauling more than 70 cars of crude oil by 2021, a requirement Moorman says took the rail industry by surprise.
    • The CEO tells WSJ that the new rules place railroads in a difficult spot because railroads do not own the vast majority of tank cars and thus have no control over whether the costly new brakes are installed; also, the brake requirement is not a mandate for tank car owners, only railroads, he says.
    • Moorman says he is sure the industry will challenge the new rules either in court or petition the DoT for reconsideration.
    • Relevant tickers: CSX, UNP, CNI, CP, KSU, BRK.A, BRK.B, GBX, WAB, TRN, ARII, RAIL
    | May 5, 2015, 5:43 PM | 26 Comments
Company Description
Union Pacific Corp is a rail transporting company. Its operating company is Union Pacific Railroad Company. It links 23 states in the western two-thirds of the country by rail, providing a critical link in the global supply chain.
Sector: Services
Industry: Railroads
Country: United States