Union Pacific (UNP) Downgraded by Zacks Investment Research to Sell

Zacks Investment Research cut shares of Union Pacific (NYSE:UNP) from a hold rating to a sell rating in a research note released on Saturday morning.

According to Zacks, “Shares of Union Pacific have underperformed its industry over the past year due to multiple headwinds like the hurricanes. Moreover, the company's high debt levels are a potent threat. Declining automotive volumes due to sluggish vehicle production in the United States are added concerns. Volumes in its automotive unit have declined 3% on a year-to-date basis. Additionally, higher fuel prices may hinder operating ratio. We are, however, imperessed by the company's efforts to reward shareholders through dividends and buybacks. Efforts to check costs also bode well for the stock.”

Other research analysts have also recently issued research reports about the stock. Argus raised their price target on shares of Union Pacific from $125.00 to $130.00 and gave the stock a buy rating in a report on Tuesday, October 31st. BMO Capital Markets reaffirmed a buy rating on shares of Union Pacific in a report on Friday, October 20th. Barclays reaffirmed a buy rating and issued a $150.00 price target on shares of Union Pacific in a report on Wednesday, December 13th. UBS Group raised shares of Union Pacific from a neutral rating to a buy rating in a report on Friday, January 5th. Finally, Morgan Stanley cut shares of Union Pacific from an overweight rating to an equal weight rating and decreased their price target for the stock from $102.00 to $100.00 in a report on Monday, October 2nd. Four equities research analysts have rated the stock with a sell rating, thirteen have assigned a hold rating and six have issued a buy rating to the company’s stock. The company currently has a consensus rating of Hold and an average price target of $121.21.

Union Pacific (NYSE:UNP) traded down $1.00 during midday trading on Friday, hitting $140.00. 3,186,193 shares of the company’s stock were exchanged, compared to its average volume of 5,096,783. The stock has a market capitalization of $111,010.00, a PE ratio of 24.78, a P/E/G ratio of 1.97 and a beta of 0.90. Union Pacific has a fifty-two week low of $101.06 and a fifty-two week high of $141.17. The company has a current ratio of 1.16, a quick ratio of 0.97 and a debt-to-equity ratio of 0.83.

Union Pacific (NYSE:UNP) last posted its quarterly earnings results on Thursday, October 26th. The railroad operator reported $1.50 earnings per share (EPS) for the quarter, topping the Zacks’ consensus estimate of $1.49 by $0.01. The business had revenue of $5.41 billion during the quarter, compared to analysts’ expectations of $5.32 billion. Union Pacific had a net margin of 21.84% and a return on equity of 23.35%. The business’s quarterly revenue was up 4.5% on a year-over-year basis. During the same quarter last year, the company posted $1.36 earnings per share. sell-side analysts forecast that Union Pacific will post 5.78 earnings per share for the current year.

The company also recently declared a quarterly dividend, which was paid on Thursday, December 28th. Investors of record on Thursday, November 30th were given a dividend of $0.665 per share. This represents a $2.66 annualized dividend and a yield of 1.90%. The ex-dividend date was Wednesday, November 29th. This is a positive change from Union Pacific’s previous quarterly dividend of $0.61. Union Pacific’s dividend payout ratio (DPR) is currently 47.08%.

Hedge funds have recently added to or reduced their stakes in the stock. Mitsubishi UFJ Securities Holdings Co. Ltd. grew its position in Union Pacific by 46.6% during the second quarter. Mitsubishi UFJ Securities Holdings Co. Ltd. now owns 1,070 shares of the railroad operator’s stock valued at $117,000 after buying an additional 340 shares during the period. Acrospire Investment Management LLC grew its position in Union Pacific by 33.3% during the second quarter. Acrospire Investment Management LLC now owns 1,200 shares of the railroad operator’s stock valued at $131,000 after buying an additional 300 shares during the period. Community Bank N.A. grew its position in Union Pacific by 3.0% during the second quarter. Community Bank N.A. now owns 1,537 shares of the railroad operator’s stock valued at $168,000 after buying an additional 45 shares during the period. Jacobi Capital Management LLC grew its position in Union Pacific by 6.6% during the second quarter. Jacobi Capital Management LLC now owns 1,705 shares of the railroad operator’s stock valued at $185,000 after buying an additional 105 shares during the period. Finally, American National Bank grew its position in Union Pacific by 24.4% during the second quarter. American National Bank now owns 1,782 shares of the railroad operator’s stock valued at $194,000 after buying an additional 350 shares during the period. Institutional investors own 78.45% of the company’s stock.

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About Union Pacific

Union Pacific Corporation is a railroad operating company in the United States. The Company operates through its principal operating company, Union Pacific Railroad Company (UPRR). Its business mix includes Agricultural Products, Automotive, Chemicals, Coal, Industrial Products and Intermodal. Its freight traffic consists of bulk, manifest, and premium business.

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