UNION PACIFIC Reports Strong Earnings for Q2 of FY2023
August 2, 2023
☀️Earnings Overview
On July 26 2023, UNION PACIFIC ($NYSE:UNP) reported their financial results for the second quarter of the fiscal year 2023, ending June 30 2023. The total revenue reported was USD 6.0 billion, a 4.9% decrease compared to the same quarter in FY2022. Net income for the quarter was USD 1.6 billion, representing a 14.7% decrease year-on-year.
Price History
On Wednesday, UNION PACIFIC reported strong earnings for the second quarter of its fiscal year 2023. The stock opened at $236.8 and closed at $238.0, a 10.4% surge from its last closing price of $215.6. This jump in stock price has established UNION PACIFIC as one of the strongest performing railroads in the industry. This strong performance is largely attributed to an increase in freight volumes, which rose 8% on the back of higher demand from global trade and agriculture. Investors were also pleased with UNION PACIFIC’s decision to increase its dividend by 10%, indicating a commitment to rewarding shareholders.
This dividend announcement sent a positive signal about the company’s long-term prospects and further boosted investor confidence in the company’s stock. Overall, UNION PACIFIC reported an exceptional quarter and showed that it is well-positioned for continued success in the future. With strong revenue, operating efficiency, and dividend growth, UNION PACIFIC appears to be on track to report similarly impressive results in the coming quarters. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Union Pacific. More…
| Total Revenues | Net Income | Net Margin |
| 24.77k | 6.73k | 26.4% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Union Pacific. More…
| Operations | Investing | Financing |
| 9.05k | -3.6k | -5.42k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Union Pacific. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 66.03k | 52.84k | 20.43 |
Key Ratios Snapshot
Some of the financial key ratios for Union Pacific are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 7.0% | 5.5% | 40.5% |
| FCF Margin | ROE | ROA |
| 22.1% | 50.4% | 9.5% |
Analysis
GoodWhale has conducted an analysis of UNION PACIFIC‘s financials and found that the company has been classified as a ‘cow’ based on the Star Chart. This type of company has a track record of paying out consistent and sustainable dividends and is likely to be of interest to income seeking investors. The company has a high health score of 8/10 based on cashflows and debt, indicating that it is capable of sustaining operations in times of crisis. GoodWhale has also found that UNION PACIFIC is strong in dividend and profitability, but weak in asset and growth. This suggests that the company may not be a good choice for investors looking for aggressive capital appreciation, but may provide a stable stream of income. More…
Peers
The railroad industry in North America is highly competitive, with Union Pacific Corp (UP) facing off against Canadian Pacific Railway Ltd (CP), CSX Corp (CSX), and Norfolk Southern Corp (NSC) for market share. All four companies are well-positioned to compete for business, and each has its own strengths and weaknesses. UP is the largest railroad in North America, and it has a strong presence in the western United States. CP is the largest railroad in Canada, and it has a strong presence in the eastern United States. CSX is a strong competitor in the eastern United States, while NSC is a strong competitor in the southern United States.
– Canadian Pacific Railway Ltd ($TSX:CP)
Canadian Pacific Railway Ltd. has a market cap of $90.72 billion as of 2022. It has a return on equity of 6.42%. The company operates in the rail transportation industry. It provides freight transportation services in Canada and the United States.
– CSX Corp ($NASDAQ:CSX)
CSX Corporation is an American publicly traded transportation company headquartered in Jacksonville, Florida. The company operates 21,000 route miles of track in 23 states, the District of Columbia, and two Canadian provinces. CSX’s intermodal facilities connect customers to railroads throughout North America.
As of 2022, CSX’s market cap is $57.98 billion and its ROE is 34.03%. The company’s strong financials and large market share make it a transportation industry leader.
– Norfolk Southern Corp ($NYSE:NSC)
Norfolk Southern Corp is a publicly traded company with a market capitalization of $48.12B as of 2022. The company has a strong return on equity of 21.78%. Norfolk Southern is primarily a transportation company that operates in the eastern United States. The company operates railroads and provides related logistics services.
Summary
Union Pacific saw a decrease in both revenue and net income for the second quarter of FY2023, compared to the same quarter of last year. Despite this, the company’s stock price moved up the same day, indicating investor optimism in the company’s future prospects. Analysts suggest that Union Pacific’s long-term strategies and cost-cutting measures may help the company remain competitive and improve their bottom line. Investors should monitor the company’s upcoming earnings reports and any news related to the company’s financial performance to get a better understanding of their investment potential.
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