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What this page is: Delvantic's full research page for Union Pacific Corporation (UNP) — AI-driven forensic equity research: mechanical valuation models (DCF, EPV, anchored-PE, scenario) plus three independent AI lenses (Quality / Value / Sentiment). Everything below is rendered server-side; you are not missing content that requires JavaScript. All scores are predictions and research opinions, not financial advice.
Our current read (analysis of 2026-09-13): Designation Low · Gem Score -23 (−100…+100 Quality+Value blend) · Quality 59 · Value -77 · Sentiment 21 (timing only, not weighted) · Composite fair value $183.45 vs $297.79 at analysis
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Union Pacific Corporation
UNP NYSEUnion Pacific Corporation is a railroad holding company headquartered in Omaha, Nebraska, with Union Pacific Railroad as its principal operating company. It provides freight transportation across 23 states in the western two-thirds of the United States, linking major West Coast and Gulf Coast ports with inland markets, Eastern gateways, Canada, and Mexico. The company serves a broad mix of industries through bulk, industrial, and premium rail services, moving commodities, raw materials, finished goods, automobiles, and intermodal containers. Union Pacific plays a central role in North American logistics by offering a large-scale rail network that supports supply chains for agriculture, energy, manufacturing, chemicals, and automotive customers.
Price Overview
Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 11.98
Total Equity: $18.47B
Shares: 595,900,000
Total Debt: $31.81B
Cash: $1.27B
EBITDA: $12.31B
Total Debt: $31.81B
Cash: $1.27B
Revenue: $24.51B
Revenue: $24.51B
Revenue: $24.51B
Total Equity: $18.47B
Tax Rate: 22.1%
Equity: $18.47B
Total Debt: $31.81B
Cash: $1.27B
Current Liabilities: $5.01B
Long-Term Debt: $31.81B
Total Debt: $31.81B
Total Equity: $18.47B
Shares: 595,900,000
Shares: 595,900,000
CapEx: -$3.79B
Shares: 595,900,000
Stock Price: $293.73
Net Income: $7.14B
Industry Benchmarks
Income Statement (Annual)
Last updated: Aug 14, 2026 12:31am (31d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $21.8B | $24.9B | $24.1B | $24.3B | $24.5B |
| Cost of Revenue | — | — | — | — | — |
| Gross Profit | — | — | — | — | — |
| Operating Expenses | $12.5B | $15.0B | $15.0B | $14.5B | $14.7B |
| Operating Income | $9.3B | $9.9B | $9.1B | $9.7B | $9.8B |
| Net Income | $6.5B | $7.0B | $6.4B | $6.7B | $7.1B |
| EBITDA | $11.5B | $12.2B | $11.4B | $12.1B | $12.3B |
| EPS | $9.98 | $11.24 | $10.47 | $11.10 | $12.00 |
| EPS (Diluted) | $9.95 | $11.21 | $10.45 | $11.09 | $11.98 |
Balance Sheet (Annual)
Last updated: Aug 13, 2026 9:17am (31d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | $960.0M | $973.0M | $1.1B | $1.0B | $1.3B |
| Total Current Assets | $3.6B | $4.0B | $4.1B | $4.0B | $4.6B |
| Total Assets | $63.5B | $65.4B | $67.1B | $67.7B | $69.7B |
| Current Liabilities | $5.7B | $5.5B | $5.1B | $5.3B | $5.0B |
| Long-Term Debt | $29.7B | $33.3B | $32.6B | $31.2B | $31.8B |
| Total Liabilities | $49.4B | $53.3B | $52.3B | $50.8B | $51.2B |
| Total Equity | $14.2B | $12.2B | $14.8B | $16.9B | $18.5B |
| Retained Earnings | $55.0B | $58.9B | $62.1B | $65.6B | $69.5B |
Cash Flow (Annual)
Last updated: Aug 14, 2026 12:31am (31d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $9.0B | $9.4B | $8.4B | $9.3B | $9.3B |
| Capital Expenditure | -$2.9B | -$3.6B | -$3.6B | -$3.5B | -$3.8B |
| Free Cash Flow | $6.1B | $5.7B | $4.8B | $5.9B | $5.5B |
| Acquisitions (net) | — | — | — | — | — |
| Net Debt Issued / (Repaid) | $4.2B | $6.1B | $1.6B | $800.0M | $2.0B |
| Dividends Paid | -$2.8B | -$3.2B | -$3.2B | -$3.2B | -$3.2B |
| Stock Buybacks | -$7.3B | -$6.3B | -$705.0M | -$1.5B | -$2.7B |
| Net Change in Cash | -$835.0M | $4.0M | $87.0M | -$46.0M | $252.0M |
Growth Trends (YoY %)
Last updated: Aug 14, 2026 12:31am (31d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | +14.1% | -3.0% | +0.5% | +1.1% |
| Gross Profit Growth | — | — | — | — |
| Operating Income Growth | +6.2% | -8.4% | +6.9% | +1.4% |
| Net Income Growth | +7.3% | -8.8% | +5.8% | +5.8% |
| EBITDA Growth | +5.3% | -6.3% | +6.2% | +1.7% |
Dividend History (Last 20)
Last updated: Aug 13, 2026 9:18am (31d ago)| Date | Dividend | Declaration | Record | Payment |
|---|---|---|---|---|
| 2026-05-29 | $1.38 | — | — | — |
| 2026-02-27 | $1.38 | — | — | — |
| 2025-12-05 | $1.38 | — | — | — |
| 2025-08-29 | $1.38 | — | — | — |
| 2025-05-30 | $1.34 | — | — | — |
| 2025-02-28 | $1.34 | — | — | — |
| 2024-12-09 | $1.34 | — | — | — |
| 2024-08-30 | $1.34 | — | — | — |
| 2024-05-31 | $1.30 | — | — | — |
| 2024-02-28 | $1.30 | — | — | — |
| 2023-12-07 | $1.30 | — | — | — |
| 2023-08-30 | $1.30 | — | — | — |
| 2023-05-30 | $1.30 | — | — | — |
| 2023-02-27 | $1.30 | — | — | — |
| 2022-12-16 | $1.30 | — | — | — |
| 2022-08-30 | $1.30 | — | — | — |
| 2022-05-27 | $1.30 | — | — | — |
| 2022-02-25 | $1.18 | — | — | — |
| 2021-12-17 | $1.18 | — | — | — |
| 2021-08-30 | $1.07 | — | — | — |
Deep Analysis
Risk : Reward — upside vs downside from this company's own quarters
Computed 2026-09-12 02:05A +1σ run of quarters pays -49%; a −1σ run costs 66%. Ratio -0.7:1 (μ 3.4%, σ 5.2% , 16 pairs).
Older method (repeat-worst-quarter): -0.7 : 1
| Case | Growth | Margin | Fair value | vs price ($297.79) |
|---|---|---|---|---|
| Bull — recovery | +8% | 33.2% | $162.66 | -45% |
| Base — stabilizes | +5% | 28.9% | $132.05 | -56% |
| Bear — keeps slipping | +3% | 24.5% | $105.36 | -65% |
| Stress — last quarter repeats | -1% | 27.6% | $104.99 | -65% |
| Upside — a +1σ run of quarters (v2) | +9% | 30.1% | $152.33 | -49% |
| Stress — a −1σ run of quarters (v2) | -2% | 27.7% | $100.98 | -66% |
Narrative Economics
market-narrative step).
Claude Reading
Looking at the raw numbers first: UNP is running $24.5B TTM revenue with essentially flat top-line growth (0.8% CAGR over five years, 1.1% recent YoY), but net income is compounding at ~5.8% and FCF at 7.3% — pure margin story. Net margins have crept from ~27% to ~29-30% and Q2 2026 just printed a 29% margin on $6.86B revenue, the best absolute revenue quarter in the series. ROE is 38.6% and ROIC 15.6%, but note the ROE is flattered by $31.8B debt against only $18.5B equity (D/E 1.72) — this is a leveraged compounder, not a pristine balance sheet. Current ratio 0.91 is fine for a railroad but leaves no slack. FCF of $5.5B against a $174.5B market cap = 3.15% FCF yield; add the 1.88% dividend and you have a ~5% total shareholder return before any growth. To justify $293, you need ~5-7% perpetual growth on that base — plausible but not cheap.
The synthesis's $183 fair value implies 38% downside, and the thesis evaluation's claim that the price "implies 31% annual FCF growth for five years" is almost certainly a modeling artifact — that's absurd on its face for a railroad and inconsistent with the narrative layer's own admission that fundamentals support 5-7% earnings growth. A 24.5x P/E on a monopoly infrastructure asset with 15.6% ROIC and pricing power is not "priced for perfection"; it's priced like every other quality compounder in this tape (CSX trades similarly, NSC too). The synthesis and thesis-eval models are anchoring on a mechanical DCF that likely uses a punitive discount rate against a business whose real cost of capital is 6-7%. Meanwhile the market-forces "neutral" call and the narrative layer's "moderate/anchored" designation are internally more coherent — they acknowledge the premium is real but not delusional.
The contrarian bear case worth taking seriously isn't the DCF gap — it's the volume story. UNP's revenue has been flat for four years while nominal GDP grew 25%+; that's genuine share loss to trucking and intermodal weakness, and it means the margin expansion is being extracted from a shrinking real franchise. Q2 2026's $6.86B pop needs to be validated — one quarter doesn't reverse a four-year trend, and the "accelerating quarterly trend" signal is fragile. If PSR-driven margin gains are approaching mathematical limits (operating margin is already 40%), then the next leg of EPS growth has to come from buybacks (payout ratio 45% leaves room) and modest pricing — call it 6-8% EPS CAGR, not the 10%+ the multiple implies. Also worth flagging: the insider data is essentially useless (six tiny award grants, no open-market buys or sells), and the 2026 quarterly data being present at all is a data-vintage question mark that no model addressed.
My read: the synthesis is directionally right that UNP is expensive but wildly overstates the gap. Fair value on a quality-compounder framework (22x normalized $12 EPS in 2027, plus dividend) lands closer to $260-270, not $183. At $293 you're paying a ~10-15% premium to a defensible fair value, not 60%. That's "trim, don't short" territory — a mature earner with genuine quality that periodically re-rates cheaper on cyclical freight scares (2022, early 2023 both offered sub-$200 entries). I'd dissent from "overvalued" as characterized and land on "modestly overvalued / fairly valued at the high end." Waiting for a freight cycle wobble to buy sub-$250 is the correct move; owning here is fine but unexciting given the 5% base return plus mid-single-digit growth = ~10% expected, which is market-average for above-market quality.
GPT Reading
What stands out is not that Union Pacific is a bad business; it is that the stock is priced as if a very good business is still becoming meaningfully better. The underlying company is plainly excellent. Revenue has barely moved over the last four annual periods, from $24.12B in 2023 to $24.25B in 2024 and $24.51B in 2025, yet net income rose from $6.38B to $6.75B to $7.14B. That tells you the story is almost entirely one of yield, mix, and efficiency rather than real freight growth. The latest quarterly run-rate is a bit better — 2026 Q2 revenue of $6.86B was up 11.5% from $6.15B a year earlier, and net income rose 5.9% to $1.99B — but even here the margin actually compressed from 30.5% to 29.0%. So the recent top-line acceleration is encouraging, but it does not yet prove a new earnings algorithm. This is still a railroad with superb economics, not a railroad suddenly entering a higher-growth phase.
The valuation asks investors to pay a premium multiple on peak-quality margins in a low-growth industry. At $293.73, UNP trades at 24.5x earnings, 7.1x sales, 16.7x EV/EBITDA, and 9.5x book. For a business growing revenue at 0.8% CAGR and earnings at 5.8% CAGR, that is a full price. The company generates terrific returns — 40.2% operating margin, 29.1% net margin, 15.6% ROIC — but part of the optical quality in ROE at 38.7% comes from leverage and buybacks rather than some hidden reinvestment runway. Debt is $31.81B against just $1.27B of cash and $18.47B of equity, with debt/equity at 1.72x and a current ratio below 1. None of that is alarming for a railroad with durable cash flows, but it matters because the easy EPS support from financial engineering is less valuable when the stock already discounts excellence. Free cash flow of $5.50B on a $174.5B market cap is roughly a 3.2% FCF yield, which is simply not enough compensation for cyclical volume risk and limited structural growth.
The key contradiction I see in the bullish framing is that investors are paying for “steady compounder” characteristics while the actual compounding is modest and increasingly dependent on operating precision near already-high margins. Annual operating income was $9.92B in 2022, then fell to $9.08B in 2023, and only recovered to $9.85B in 2025. That is resilience, but not linear compounding. Even using the stronger recent two quarters, trailing annualized revenue is only moving from the mid-$24B range toward perhaps the mid-$25B range, hardly enough to justify a multiple usually reserved for businesses with clearer secular demand tailwinds. Railroads deserve a premium to average industrials because the network is scarce and replacement cost is absurdly high, but this stock looks priced as if scarcity alone can offset maturity forever. My read is that fair value is materially lower, closer to $220-$240, where the quality of the franchise and the stability of the cash flows would still be respected without assuming much more margin expansion.
The strongest case against that view is straightforward: railroads are not ordinary cyclicals, and UNP’s quality may warrant a persistent premium. Even with revenue flat, the company has lifted net income from $6.52B in 2021 to $7.14B in 2025, free cash flow has compounded 7.3%, and the latest quarter’s $6.86B revenue shows there may be more pricing power and volume recovery than the annual figures suggest. If that Q2 strength is the start of a sustained step-up rather than a blip, then a 24-25x P/E may prove less stretched than it looks, especially for a business with irreplaceable infrastructure, disciplined capital allocation, and sub-2% dividend yield that can still grow the payout with a 45% payout ratio. I take that argument seriously. But I weigh it differently because the evidence so far shows a company squeezing more profit from a largely mature revenue base, not one that has unlocked a new growth vector. Once you are already at 28-30% net margins, each additional point of operational improvement gets harder.
What would change my mind is not another quarter of EPS beats driven by cost discipline; it is proof of durable top-line momentum without margin sacrifice. If UNP can sustain quarterly revenue above $6.7B for the next several quarters, push annual revenue convincingly above $26B, and still hold operating margin around 40% with free cash flow moving toward $6.5B-$7.0B, then the case for a premium multiple strengthens materially. Conversely, if the recent revenue pop fades back toward the $6.1B-$6.3B quarterly range while margins remain flat, the current valuation will look even more exposed. At nearly $294, I think the market is already paying in advance for the good outcome.
Grok Reading
The raw numbers describe a cash machine running on a flat track. Union Pacific generated $24.51B in 2025 revenue against $24.25B the year prior and $24.88B in 2022—four years of essentially zero top-line progress, confirmed by a 0.8% revenue CAGR and a recent 1.1% y/y print. Yet net income climbed to $7.14B from $6.75B and $6.38B, pushing net margins into the 27–30% band every recent quarter and producing a 5.8% earnings CAGR and 7.3% FCF CAGR. That divergence is the entire story: precision scheduled railroading and oligopoly rate discipline are converting a stagnant freight base into $5.50B of free cash flow on $9.29B of operating cash, with a 40% operating margin that few industrials can touch. The balance sheet is the cost of that efficiency—$31.81B of debt against $1.27B cash and a 1.72 debt-to-equity ratio, current ratio under 1.0—so the 38.7% ROE is leverage-amplified, not pure economic return (ROIC sits at a more sober 15.6%).
At $293.73 the market is paying 24.5× earnings, 7.1× sales, and 16.7× EV/EBITDA for sub-1% volume growth. That multiple embeds the reshoring-and-pricing-power narrative far more aggressively than the income statement supports. A 5.8% earnings grower with a 1.9% dividend yield and a 45% payout does not clear a 24× hurdle unless you believe mid-to-high single-digit FCF compounding is locked in for a decade; the trailing data show revenue still crawling and the latest quarter’s $6.86B spike still looking like a one-period bounce rather than a regime change. The valuation synthesis fair value near $184 is directionally correct even if the precise DCF is debatable—$294 is a 50–60% premium to any conservative capitalization of today’s $5.5B FCF at a mid-teens multiple appropriate for a mature Class I railroad.
The strongest opposing case is that the market is not buying next year’s freight carloads; it is buying an irreplaceable western franchise with proven ability to raise price above cost inflation and still expand margins from already-elite levels. Bulls correctly note that earnings and FCF have compounded 6–7% while revenue went nowhere, that FCF quality is clean, and that sector-relative returns (ROE, margins) sit well above industrial benchmarks. If PSR operating leverage still has innings left and nearshoring eventually shows up in volumes, the 24× multiple can be defended as a scarcity premium on regulated infrastructure rather than a growth multiple. I weigh that less heavily because the same data set already reflects years of PSR gains and pricing discipline—margins are near mathematical ceilings for a railroad—and the 0.8% revenue CAGR is the structural tell, not a temporary soft patch. Paying for monopoly optionality is rational; paying 24× for it when the volume engine is stalled is not.
I would reverse to neutral or constructive only on two concrete developments: trailing twelve-month revenue growth sustained above 4% with stable or rising volumes (not just price), or a clear path to sub-18× forward earnings via either multiple compression or a step-change in FCF that makes the current price an 8%+ free-cash-flow yield. Absent one of those, the stock remains a high-quality compounder priced as if the compounding has already accelerated.
Big-3 Panel — where each AI stands
Advanced Analysis Forensic deep-dive · separate lenses
Union Pacific is a classic mature earner: revenue drifted from $21.8B (2021) to $24.5B (2025) — roughly 3% CAGR, essentially GDP-like — with operating margins in a healthy 37.7%-42.8% band and net income landing at $7.14B in 2025, a record. Free cash flow has run $4.77B-$6.10B annually, and 2025 FCF of $5.50B comfortably funds capex-heavy rail operations. Earnings quality is high: OCF/NI of 1.34x, accruals -3.5% of assets, and Altman Z of 4.25 all say the reported profits are real cash profits. Per-share value is being concentrated aggressively — diluted share count fell from 655.4M to 595.9M (-2.4% CAGR), SBC is a trivial 0.4% of revenue, and buybacks run 63x SBC. Management is clearly a net returner of capital, not a diluter. The one meaningful constraint is the balance sheet: net debt of $30.55B against $1.27B of cash means leverage is the structural cost of the buyback/dividend model. Altman Z at 4.25 says this is manageable, not stressed, but it is a real constraint versus a fortress. The rail duopoly economics (implied moat) and 40% operating margins point to genuine pricing power and durability, though revenue growth has stalled around $24B for four straight years.
Verify before trusting this (6)
- Debt maturity ladder and weighted-average interest rate on the $30B+ debt stack
- Volume vs price/mix decomposition of the flat 2022-2025 revenue line
- Pension and OPEB obligations not visible in headline net debt figure
- Capex intensity trend and whether maintenance vs growth capex mix has shifted
- Any regulatory or STB action affecting pricing power
- Customer/commodity concentration (coal decline exposure, intermodal partner risk)
The e2e composite pegs deserved value at ~$184.69 (signal-adjusted $183.30), implying roughly -38% downside from $297.79. The cash-based methods are tightly clustered and skeptical: DCF at $134.53 and EPV floor at $128.69 both say the current cash-generation, even capitalized generously, does not underwrite $298. The only method that gets near price is the anchored P/E at $341, which is a multiple-on-multiple exercise that assumes today's rich rating persists; it should not be treated as gospel. Earnings quality is high, so no haircut is warranted, and the franchise is genuinely strong which lifts deserved value above the raw DCF/EPV floor toward the high $100s to low $200s. Even generously blending quality premium with cash-flow reality, deserved value lands well below $250. The market is paying a monopoly-infrastructure premium at a time when revenue has been flat for four years and EPS growth is being manufactured by leveraged buybacks. That's a steady compounder rating priced as if secular growth is about to reaccelerate; the bear's 'priced for perfection' read is the honest one here. Not a short thesis, just no margin of safety and negative expected value versus the deserved-price anchor.
Verify before trusting this (4)
- Volume trends by segment (intermodal vs bulk vs industrial) in the latest 10-Q to test whether revenue can inflect
- Pricing/mix commentary and any operating ratio guidance on the earnings call
- Buyback pace vs FCF and incremental leverage taken on to fund it
- Any capex step-up or regulatory (STB) rate-review risk that would compress the deserved multiple
The macro backdrop is mildly supportive: a risk-on regime with a 14.6 VIX and S&P near highs favors quality industrials, and with beta near 1.0 UNP neither amplifies nor mutes the tape much. What matters more here is the narrative: UNP is a steady-compounder wrapped in an active, high-profile transcontinental merger story with Norfolk Southern. That story is generating steady press flow, drawing analyst attention, and giving the stock a reason to trade above DCF fair value - the market is paying for optionality, not just cash flow. Q2 beat plus raised outlook (July 23, +4% reaction) is still an anchor in the tape. Analyst tone is 'moderately optimistic,' consistent with recent outperformance versus the broader market. On the other side, sentiment is not one-way: multiple pieces (Simply Wall St-style 'looks cheap on earnings but fair on cash flow,' 'is the upside priced in') are seeding a 'priced for perfection' counter-narrative, and seven GOP state AGs publicly opposing the merger inject binary regulatory-headline risk. Net, the pressure is a modest tailwind - narrative live and constructive, tape supportive, but with a valuation ceiling forming in the commentary.
Verify before trusting this (4)
- STB/DOJ signals or timeline updates on the UP-NS merger review - any negative leak flips this to headwind quickly
- Whether the 'priced for perfection' narrative gathers pace in sell-side notes or stays a fringe take
- Intermodal and carload weekly volume trends - a soft print would validate the late-cycle bear case
- Rotation out of quality industrials if VIX spikes or the risk-on regime breaks
This lens hasn't been run for this ticker yet.
When we made this prediction on Aug 14, 2026, UNP was $297.79. We expect it to be $276.00 by Feb 2027, and we consider it great value under $210.00. This is an early model (v0.6.0) — the direction is more reliable than the exact price. Made Aug 14, 2026.
Blue is our prediction, starting the day we made it. Grey is a slower route to the same place — the same destination, taking longer. Black is the actual price, so you can see how we are doing.
Post-Report Due Diligence NOTES
Evidence for a closer look, not a verdict — no score or designation on this page has been changed by it. Items marked material are ones where a conclusion above moves to the other side of the price.
trailing_eps
flips down 25%
adjusted_pe
flips down 25%