UNION PACIFIC CORP (UNP) Stock Fundamental Analysis
NYSE:UNP - New York Stock Exchange, Inc. - US9078181081 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to UNP. UNP was compared to 40 industry peers in the Ground Transportation industry. UNP has an excellent profitability rating, but there are some minor concerns on its financial health. UNP has a decent growth rate and is not valued too expensively. UNP also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year UNP was profitable.
UNP had a positive operating cash flow in the past year.
Each year in the past 5 years UNP has been profitable.
UNP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 9.83%, UNP belongs to the top of the industry, outperforming 87.50% of the companies in the same industry.
UNP has a Return On Equity of 41.97%. This is amongst the best in the industry. UNP outperforms 97.50% of its industry peers.
Looking at the Return On Invested Capital, with a value of 12.03%, UNP belongs to the top of the industry, outperforming 92.50% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for UNP is above the industry average of 7.92%.
The 3 year average ROIC (12.01%) for UNP is below the current ROIC(12.03%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.83% | ||
| ROE | 41.97% | ||
| ROIC | 12.03% |
ROA(3y)10.05%
ROA(5y)9.8%
ROE(3y)46.87%
ROE(5y)43.64%
ROIC(3y)12.01%
ROIC(5y)11.77%
1.3 Margins
The Profit Margin of UNP (27.77%) is better than 100.00% of its industry peers.
UNP's Profit Margin has been stable in the last couple of years.
Looking at the Operating Margin, with a value of 40.06%, UNP belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
In the last couple of years the Operating Margin of UNP has remained more or less at the same level.
UNP has a Gross Margin of 79.56%. This is amongst the best in the industry. UNP outperforms 90.00% of its industry peers.
UNP's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 40.06% | ||
| PM (TTM) | 27.77% | ||
| GM | 79.56% |
OM growth 3Y-2.21%
OM growth 5Y0.33%
PM growth 3Y-2.39%
PM growth 5Y0.4%
GM growth 3Y-0.81%
GM growth 5Y-0.13%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), UNP is creating some value.
UNP has less shares outstanding than it did 1 year ago.
The number of shares outstanding for UNP has been reduced compared to 5 years ago.
The debt/assets ratio for UNP has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.68 indicates that UNP is not in any danger for bankruptcy at the moment.
The Altman-Z score of UNP (3.68) is better than 77.50% of its industry peers.
UNP has a debt to FCF ratio of 5.59. This is a neutral value as UNP would need 5.59 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 5.59, UNP is doing good in the industry, outperforming 72.50% of the companies in the same industry.
UNP has a Debt/Equity ratio of 1.91. This is a high value indicating a heavy dependency on external financing.
UNP has a Debt to Equity ratio of 1.91. This is amonst the worse of the industry: UNP underperforms 80.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.91 | ||
| Debt/FCF | 5.59 | ||
| Altman-Z | 3.68 |
ROIC/WACC1.31
WACC9.16%
2.3 Liquidity
A Current Ratio of 0.73 indicates that UNP may have some problems paying its short term obligations.
UNP has a Current ratio of 0.73. This is amonst the worse of the industry: UNP underperforms 85.00% of its industry peers.
UNP has a Quick Ratio of 0.73. This is a bad value and indicates that UNP is not financially healthy enough and could expect problems in meeting its short term obligations.
UNP's Quick ratio of 0.61 is on the low side compared to the rest of the industry. UNP is outperformed by 87.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.61 |
3. Growth
3.1 Past
UNP shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.70%.
UNP shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.83% yearly.
Looking at the last year, UNP shows a small growth in Revenue. The Revenue has grown by 0.63% in the last year.
UNP shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.24% yearly.
EPS 1Y (TTM)6.7%
EPS 3Y3.84%
EPS 5Y5.83%
EPS Q2Q%0.37%
Revenue 1Y (TTM)0.63%
Revenue growth 3Y3.61%
Revenue growth 5Y2.24%
Sales Q2Q%-0.07%
3.2 Future
Based on estimates for the next years, UNP will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.43% on average per year.
The Revenue is expected to grow by 4.63% on average over the next years.
EPS Next Y4.28%
EPS Next 2Y7.59%
EPS Next 3Y8.2%
EPS Next 5Y9.43%
Revenue Next Year1.06%
Revenue Next 2Y2.77%
Revenue Next 3Y3.31%
Revenue Next 5Y4.63%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 19.99, the valuation of UNP can be described as rather expensive.
75.00% of the companies in the same industry are more expensive than UNP, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of UNP to the average of the S&P500 Index (25.91), we can say UNP is valued slightly cheaper.
UNP is valuated rather expensively with a Price/Forward Earnings ratio of 17.28.
Based on the Price/Forward Earnings ratio, UNP is valued a bit cheaper than 65.00% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.85, UNP is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.99 | ||
| Fwd PE | 17.28 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as UNP.
Based on the Price/Free Cash Flow ratio, UNP is valued a bit cheaper than the industry average as 77.50% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.67 | ||
| EV/EBITDA | 13.61 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of UNP may justify a higher PE ratio.
PEG (NY)4.67
PEG (5Y)3.43
EPS Next 2Y7.59%
EPS Next 3Y8.2%
5. Dividend
5.1 Amount
UNP has a Yearly Dividend Yield of 2.32%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.52, UNP pays a better dividend. On top of this UNP pays more dividend than 97.50% of the companies listed in the same industry.
UNP's Dividend Yield is comparable with the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.32% |
5.2 History
The dividend of UNP is nicely growing with an annual growth rate of 7.62%!
UNP has been paying a dividend for at least 10 years, so it has a reliable track record.
UNP has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)7.62%
Div Incr Years17
Div Non Decr Years25
5.3 Sustainability
UNP pays out 47.86% of its income as dividend. This is a bit on the high side, but may be sustainable.
UNP's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP47.86%
EPS Next 2Y7.59%
EPS Next 3Y8.2%
222.87
-0.75 (-0.34%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryGround Transportation
Earnings (Last)
Earnings (Next)
Inst Owners82.2%
Inst Owner Change0.5%
Ins Owners0.09%
Ins Owner Change3.72%
Market Cap133.16B
Analysts77.71
Price Target249.84 (12.1%)
Short Float %1.36%
Short Ratio2.51
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.32% |
Yearly Dividend5.29
Dividend Growth(5Y)7.62%
DP47.86%
Div Incr Years17
Div Non Decr Years25
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.25%
Min EPS beat(2)-2.76%
Max EPS beat(2)5.25%
EPS beat(4)2
Avg EPS beat(4)0.14%
Min EPS beat(4)-2.76%
Max EPS beat(4)5.25%
EPS beat(8)5
Avg EPS beat(8)0.51%
EPS beat(12)8
Avg EPS beat(12)0.55%
EPS beat(16)11
Avg EPS beat(16)0.99%
Revenue beat(2)0
Avg Revenue beat(2)-1.62%
Min Revenue beat(2)-1.9%
Max Revenue beat(2)-1.34%
Revenue beat(4)0
Avg Revenue beat(4)-1.74%
Min Revenue beat(4)-1.9%
Max Revenue beat(4)-1.34%
Revenue beat(8)1
Avg Revenue beat(8)-1.46%
Revenue beat(12)3
Avg Revenue beat(12)-1.04%
Revenue beat(16)7
Avg Revenue beat(16)-0.36%
PT rev (1m)-7.14%
PT rev (3m)-7.63%
EPS NQ rev (1m)-3.22%
EPS NQ rev (3m)-4.22%
EPS NY rev (1m)-2.76%
EPS NY rev (3m)-4.12%
Revenue NQ rev (1m)-1.32%
Revenue NQ rev (3m)-1.79%
Revenue NY rev (1m)-1.88%
Revenue NY rev (3m)-2.1%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.99 | ||
| Fwd PE | 17.28 | ||
| P/S | 5.49 | ||
| P/FCF | 22.67 | ||
| P/OCF | 14.11 | ||
| P/B | 8.3 | ||
| P/tB | 8.3 | ||
| EV/EBITDA | 13.61 |
EPS(TTM)11.15
EY5%
EPS(NY)12.89
Fwd EY5.79%
FCF(TTM)9.83
FCFY4.41%
OCF(TTM)15.79
OCFY7.08%
SpS40.58
BVpS26.84
TBVpS26.84
PEG (NY)4.67
PEG (5Y)3.43
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.83% | ||
| ROE | 41.97% | ||
| ROCE | 15.6% | ||
| ROIC | 12.03% | ||
| ROICexc | 12.3% | ||
| ROICexgc | 12.3% | ||
| OM | 40.06% | ||
| PM (TTM) | 27.77% | ||
| GM | 79.56% | ||
| FCFM | 24.22% |
ROA(3y)10.05%
ROA(5y)9.8%
ROE(3y)46.87%
ROE(5y)43.64%
ROIC(3y)12.01%
ROIC(5y)11.77%
ROICexc(3y)12.22%
ROICexc(5y)12.01%
ROICexgc(3y)12.22%
ROICexgc(5y)12.01%
ROCE(3y)15.58%
ROCE(5y)15.27%
ROICexcg growth 3Y-1.3%
ROICexcg growth 5Y0.85%
ROICexc growth 3Y-1.3%
ROICexc growth 5Y0.85%
OM growth 3Y-2.21%
OM growth 5Y0.33%
PM growth 3Y-2.39%
PM growth 5Y0.4%
GM growth 3Y-0.81%
GM growth 5Y-0.13%
F-Score7
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.91 | ||
| Debt/FCF | 5.59 | ||
| Debt/EBITDA | 2.52 | ||
| Cap/Depr | 147.51% | ||
| Cap/Sales | 14.69% | ||
| Interest Coverage | 7.86 | ||
| Cash Conversion | 77.8% | ||
| Profit Quality | 87.24% | ||
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.61 | ||
| Altman-Z | 3.68 |
F-Score7
WACC9.16%
ROIC/WACC1.31
Cap/Depr(3y)153.57%
Cap/Depr(5y)145.22%
Cap/Sales(3y)14.58%
Cap/Sales(5y)14.44%
Profit Quality(3y)81.41%
Profit Quality(5y)88.52%
High Growth Momentum
Growth
EPS 1Y (TTM)6.7%
EPS 3Y3.84%
EPS 5Y5.83%
EPS Q2Q%0.37%
EPS Next Y4.28%
EPS Next 2Y7.59%
EPS Next 3Y8.2%
EPS Next 5Y9.43%
Revenue 1Y (TTM)0.63%
Revenue growth 3Y3.61%
Revenue growth 5Y2.24%
Sales Q2Q%-0.07%
Revenue Next Year1.06%
Revenue Next 2Y2.77%
Revenue Next 3Y3.31%
Revenue Next 5Y4.63%
EBIT growth 1Y6.03%
EBIT growth 3Y1.32%
EBIT growth 5Y2.57%
EBIT Next Year33.29%
EBIT Next 3Y14.56%
EBIT Next 5Y10.81%
FCF growth 1Y8.32%
FCF growth 3Y-1.12%
FCF growth 5Y2.71%
OCF growth 1Y5.22%
OCF growth 3Y1.15%
OCF growth 5Y1.66%