Start here if you're new
what it is
Union Pacific moves freight across 32,880 route miles in the western two-thirds of the U.S. and gets paid every time your economy needs hauling.
how it gets paid
Last year Union Pacific made $24.5B in revenue. Chemicals & plastics was the main engine at $9.07B, or 37% of sales.
why it's growing
Revenue grew 1.1% last year. Pricing was healthy considering that the average revenue per carload was up 4%.
what just happened
Q4 2025: diluted EPS $3.11; adjusted diluted EPS $2.86. Operating revenue ~$6.1B (−1% YoY). Results included ~$234M industrial land-sale benefit (~$0.30 EPS) and ~$30M merger-related costs (~$0.05 EPS). FY 2025 diluted EPS $11.98; adjusted diluted EPS $11.66. Source: Union Pacific Q4/FY 2025 earnings materials (Jan 2026).
At a glance
A+ balance sheet — rock-solid finances — built to survive anything
95/100 earnings predictability — you can trust these numbers
20.2x trailing p/e — priced about right
2.6% dividend yield — cash in your pocket every quarter
19.5% return on capital — strong for a capital-heavy railroad
xvary composite: 81/100 — above average
What they do
Union Pacific moves freight across 32,880 route miles in the western two-thirds of the U.S. and gets paid every time your economy needs hauling.
Railroad moat → tracks nobody wants to rebuild → so what: you are renting scarce infrastructure. Union Pacific covers 32,880 route miles and posted a 40.2% operating margin, which is what happens when replacing you costs billions and years.
How they make money
$24.5B
annual revenue · their business grew +1.1% last year
Intermodal
$4.41B
Automotive
$2.94B
Chemicals & plastics
$9.07B
Grain
$4.90B
Coal & other bulk
$3.18B
The products that matter
moves freight by rail
Freight Rail Network
$24.5B revenue · 32,880 route miles
it is the whole story: a 32,880-mile rail network that produced $24.5B in FY operating revenue. Net margin in the health strip below is anchored to trailing financials (~high-20s % on revenue)—not low-30s—so treat margin as strong for rails, not startup software.
core
Key numbers
40.2%
operating margin
Operating margin → money left after running the railroad → so what: Union Pacific keeps about 40 cents from each revenue dollar before interest and taxes.
19.5%
return on capital
Return on capital → profit on money invested → so what: this railroad earns far more on its assets than most industrial companies.
95
price stability
This 95 is price stability (matches health). The glance strip’s 95/100 is earnings predictability—a different metric that also reads 95 here.
2.6%
dividend yield
You get paid while you wait, and the dividend has grown 11.0% annually in the past period cited by the primary data source.
Financial health
A+
strength
- balance sheet grade A+ — near the highest rating possible
- risk rank 1 — safer than 95% of stocks
- price stability 95 / 100
- long-term debt $30.3B (18% of capital)
- net profit margin ~29% — roughly 29¢ per revenue dollar (trailing feed; reconcile to FY net income ÷ revenue)
- return on equity 38% — $0.38 profit for every $1 investors have put in
A+ with balance sheet grade and risk rank standing out. your money faces less risk here than at most public companies.
Total return vs. market
You invested $10,000 in UNP 3 years ago → it's now worth $11,810.
The index would have given you $13,880.
source: institutional data · total return
What just happened
GAAP vs adjusted
Q4 2025: diluted EPS $3.11; adjusted diluted EPS $2.86 (down vs prior-year adjusted $2.96). Operating revenue ~$6.1B (−1% YoY).
Reported diluted EPS included a net ~$0.30 benefit from industrial land sales and ~$0.05 drag from merger-related costs (company disclosure). FY 2025 diluted EPS $11.98; adjusted diluted EPS $11.66. Adjusted operating ratio ~60% for the quarter in company materials.
$6.1B
Q4 op. revenue
$3.11
diluted eps
$2.86
adj. diluted eps
how to read it
Do not compare $3.11 diluted directly to adjusted $2.86—or to last year’s adjusted figure—without netting the one-time items called out in the release.
-
union pacific reported lower profits in the december period.
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adjusted diluted EPS of $2.86 was down from $2.96 in the prior-year quarter; reported diluted EPS was $3.11 after land-sale and merger-cost impacts.
-
full-year adjusted diluted EPS was $11.66; reported diluted EPS was $11.98.FY operating revenue was ~$24.5B (+1% YoY) per the same Jan 2026 release. Volume and mix commentary in filings matters as much as the headline EPS figures.
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pricing was healthy considering that the average revenue per carload was up 4%.
-
efficiency measures were also encouraging as the year came to a close, with freight car velocity rising 9%, terminal dwell improving by 9%, and workforce productivity up 3%. we look for earnings to rebound in the coming quarters.the improvements that the company is making in its operating efficiency should lead to higher margins as 2026 progresses.
source: Union Pacific Q4 & full-year 2025 earnings release (Jan 2026) — SEC EDGAR / investor.unionpacific.com
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What could go wrong
the #1 risk is regulatory and legal action on rail pricing and service.
med
regulatory and legal pressure
Railroads are essential infrastructure, which means pricing, fees, and service levels attract attention when customers get loud or regulators get curious.
If pricing power gets constrained, it hits the exact part of the story investors pay for: that 30.3% net margin on $24.5B in revenue.
med
volume tied to the real economy
Union Pacific is not a software subscription. Freight volumes depend on industrial production, consumer demand, and how much stuff needs to move across the western U.S.
That exposes nearly all $24.5B of revenue to a weaker freight environment, and recent 1.1% growth leaves little cushion.
med
premium valuation for a slow grower
20.2x trailing earnings is not outrageous, but it is full enough that investors expect consistency to keep showing up every quarter.
If margin slips from the recent 28.6% quarterly level while revenue stays near 1.1% growth, the multiple has less reason to stay elevated.
A railroad with 95/100 earnings predictability still faces a simple math problem: if pricing gets pressured or freight softens, a $140B stock valued at 20.2x earnings can feel expensive quickly.
source: institutional data · regulatory filings · risk analysis
Pay attention to
risk
rail pricing and service disputes
This is the cleanest way to track whether regulatory attention stays background noise or starts threatening the margin story.
metric
net margin
30.3% for the full year and 28.6% last quarter are the numbers defending the premium multiple.
calendar
next earnings report
You want to see whether adjusted EPS (~$2.86 in Q4 2025) stabilizes after one-time land sales and merger costs roll off, and whether the operating ratio holds near ~60%.
trend
revenue growth
1.1% growth is fine for defense, not enough for re-rating. If that number improves, the story changes with it.
Analyst rankings
short-term outlook
average
momentum score 3 — in human-speak, analysts see a steady stock, not one flashing a strong short-term signal.
risk profile
safest 5%
stability score 1 — lower risk of permanent damage than most stocks you can buy.
chart momentum
average
technical score 3 — the chart is behaving normally. No panic. No breakout.
earnings predictability
95 / 100
management tends to deliver what the market expects. That helps explain why the stock trades like a bond with locomotives.
source: institutional data
Institutional activity
institutions have been net selling for 3 consecutive quarters — 1,132 buyers vs. 1,171 sellers in 3q2025. total institutional holdings: 0.5B shares. net selling for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$197
$327
$235
current price
$262
target midpoint · +11% from current · 3-5yr high: $395 (+70% · 16% ann'l return)
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