UNP Union Pacific

Union Pacific operates one of the largest US freight railroad networks, delivering bulk commodities, industrial products, and consumer goods across the western United States. Sector: Industrials.

Union Pacific (UNP) is an individual stock. The analysis below presents key financial metrics for the company, covering profitability, capital efficiency, valuation, margins, and growth.

Looking at how effectively the company deploy capital, ROIC is 13.79%, WACC is 9.29%, and the economic spread is 4.50%. On balance, the spread between ROIC and WACC is narrow, leaving little buffer but still pointing to net positive value generation. Supporting metrics show ROE at 39.74% and ROA at 9.90%, a combination that helps frame whether profitability strength is broad enough to hold through different market conditions. Taken together, the return profile suggests a company that is value-creative but with less room for execution slippage.

From a pricing standpoint, the company sits at trailing P/E of 23.70, forward P/E of 21.98, PEG of 3.07. The narrow spread between trailing and forward multiples implies earnings expectations are relatively stable — the company is not being priced for an earnings inflection. A PEG above 2.5 implies investors are paying well above fair value for the growth embedded in estimates — a setup that typically leaves little room for earnings disappointment. A current ratio reading of 0.99 suggests the company carries less short-term financial cushion than the broader market average. In total, the multiple and liquidity readings describe a company where valuation is a secondary risk relative to earnings delivery — the numbers are defensible if estimates hold.

Across the three margin layers, gross margin sits at 50.95%, operating margin at 40.42%, and free cash flow margin at 25.60%. Gross margins sit in a healthy range, consistent with businesses that manage input costs effectively. Operating margins this strong typically indicate a combination of pricing power, cost discipline, and operating leverage. Free cash flow conversion is exceptional, indicating the company that are self-funding and cash-generative well above average. The margin profile is consistently healthy, a pattern often associated with durable competitive position and execution quality.

On a forward-looking basis, TTM revenue growth of 11.54% a signal of steady demand without the volatility of high-growth names, while the estimated 12-month price change of 15.44%, where the target distribution indicates incremental upside rather than outsized repricing. Revenue growth and price targets are correlated but not the same — strong operations do not always translate to strong price appreciation, and vice versa. The forward return case rests on whether the company can sustain their operating trajectory long enough for analyst price targets to be reached or exceeded. The estimated 12-month price change is based on analyst consensus price target estimates, sourced from publicly available data, and should not be interpreted as a reliable prediction of future performance.

Balancing the strengths against the areas of uncertainty, the weight of evidence favors an optimistic view with appropriate risk awareness.

This summary is based on publicly available quantitative data and is not intended as investment advice. Carefully consider your personal financial circumstances before making any decisions.