UNION PACIFIC CORP (UNP) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:UNP - US9078181081 - Common Stock
233.58 USD
+5.87 (+2.58%)
233.58 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to UNP. UNP was compared to 42 industry peers in the Ground Transportation industry. While UNP belongs to the best of the industry regarding profitability, there are concerns on its financial health. UNP has a correct valuation and a medium growth rate. 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.
- UNP had positive earnings in each of the past 5 years.
- Each year in the past 5 years UNP had a positive operating cash flow.
1.2 Ratios
- UNP has a Return On Assets of 10.24%. This is amongst the best in the industry. UNP outperforms 92.86% of its industry peers.
- UNP has a better Return On Equity (38.65%) than 97.62% of its industry peers.
- The Return On Invested Capital of UNP (11.77%) is better than 92.86% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for UNP is above the industry average of 6.92%.
- The last Return On Invested Capital (11.77%) for UNP is above the 3 year average (11.70%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.24% | ||
| ROE | 38.65% | ||
| ROIC | 11.77% |
ROA(3y)9.9%
ROA(5y)10.13%
ROE(3y)40.58%
ROE(5y)45.07%
ROIC(3y)11.7%
ROIC(5y)12.08%
1.3 Margins
- Looking at the Profit Margin, with a value of 29.12%, UNP belongs to the top of the industry, outperforming 95.24% of the companies in the same industry.
- UNP's Profit Margin has been stable in the last couple of years.
- UNP has a better Operating Margin (40.17%) than 100.00% of its industry peers.
- UNP's Operating Margin has been stable in the last couple of years.
- The Gross Margin of UNP (79.53%) is better than 90.48% of its industry peers.
- In the last couple of years the Gross Margin of UNP has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 40.17% | ||
| PM (TTM) | 29.12% | ||
| GM | 79.53% |
OM growth 3Y0.25%
OM growth 5Y0.03%
PM growth 3Y1.16%
PM growth 5Y1.24%
GM growth 3Y1.37%
GM growth 5Y-0.95%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so UNP is still creating some value.
- UNP has less shares outstanding than it did 1 year ago.
- UNP has less shares outstanding than it did 5 years ago.
- The debt/assets ratio for UNP has been reduced compared to a year ago.
2.2 Solvency
- The Debt to FCF ratio of UNP is 5.79, which is a neutral value as it means it would take UNP, 5.79 years of fcf income to pay off all of its debts.
- UNP has a better Debt to FCF ratio (5.79) than 76.19% of its industry peers.
- A Debt/Equity ratio of 1.64 is on the high side and indicates that UNP has dependencies on debt financing.
- The Debt to Equity ratio of UNP (1.64) is worse than 78.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.64 | ||
| Debt/FCF | 5.79 | ||
| Altman-Z | N/A |
ROIC/WACC1.21
WACC9.75%
2.3 Liquidity
- UNP has a Current Ratio of 0.91. 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 Current ratio of 0.91 is on the low side compared to the rest of the industry. UNP is outperformed by 66.67% of its industry peers.
- A Quick Ratio of 0.91 indicates that UNP may have some problems paying its short term obligations.
- UNP has a worse Quick ratio (0.91) than 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.91 | ||
| Quick Ratio | 0.91 |
3. Growth
3.1 Past
- UNP shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.76%.
- Measured over the past 5 years, UNP shows a small growth in Earnings Per Share. The EPS has been growing by 7.34% on average per year.
- Looking at the last year, UNP shows a small growth in Revenue. The Revenue has grown by 1.07% in the last year.
- Measured over the past years, UNP shows a small growth in Revenue. The Revenue has been growing by 4.64% on average per year.
EPS 1Y (TTM)4.76%
EPS 3Y0.9%
EPS 5Y7.34%
EPS Q2Q%-3.38%
Revenue 1Y (TTM)1.07%
Revenue growth 3Y-0.49%
Revenue growth 5Y4.64%
Sales Q2Q%-0.59%
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 11.47% on average per year.
- UNP is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.84% yearly.
EPS Next Y7.95%
EPS Next 2Y8.77%
EPS Next 3Y10.09%
EPS Next 5Y11.47%
Revenue Next Year3.36%
Revenue Next 2Y4.31%
Revenue Next 3Y10.6%
Revenue Next 5Y10.84%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- 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 20.02, the valuation of UNP can be described as rather expensive.
- UNP's Price/Earnings ratio is a bit cheaper when compared to the industry. UNP is cheaper than 78.57% of the companies in the same industry.
- UNP is valuated rather cheaply when we compare the Price/Earnings ratio to 28.60, which is the current average of the S&P500 Index.
- UNP is valuated rather expensively with a Price/Forward Earnings ratio of 18.54.
- Based on the Price/Forward Earnings ratio, UNP is valued a bit cheaper than the industry average as 78.57% of the companies are valued more expensively.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.83, UNP is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.02 | ||
| Fwd PE | 18.54 |
4.2 Price Multiples
- UNP's Enterprise Value to EBITDA is on the same level as the industry average.
- 85.71% of the companies in the same industry are more expensive than UNP, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.2 | ||
| EV/EBITDA | 13.45 |
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)2.52
PEG (5Y)2.73
EPS Next 2Y8.77%
EPS Next 3Y10.09%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.37%, UNP has a reasonable but not impressive dividend return.
- UNP's Dividend Yield is rather good when compared to the industry average which is at 0.69. UNP pays more dividend than 97.62% of the companies in the same industry.
- UNP's Dividend Yield is a higher than the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.37% |
5.2 History
- On average, the dividend of UNP grows each year by 7.01%, which is quite nice.
- 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)7.01%
Div Incr Years18
Div Non Decr Years26
5.3 Sustainability
- UNP pays out 45.33% 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.
DP45.33%
EPS Next 2Y8.77%
EPS Next 3Y10.09%
UNION PACIFIC CORP / UNP FAQ
What is the ChartMill fundamental rating of UNION PACIFIC CORP (UNP) stock?
ChartMill assigns a fundamental rating of 6 / 10 to UNP.
What is the valuation status of UNION PACIFIC CORP (UNP) stock?
ChartMill assigns a valuation rating of 5 / 10 to UNION PACIFIC CORP (UNP). This can be considered as Fairly Valued.
Can you provide the profitability details for UNION PACIFIC CORP?
UNION PACIFIC CORP (UNP) has a profitability rating of 9 / 10.
How financially healthy is UNION PACIFIC CORP?
The financial health rating of UNION PACIFIC CORP (UNP) is 3 / 10.
How sustainable is the dividend of UNION PACIFIC CORP (UNP) stock?
The dividend rating of UNION PACIFIC CORP (UNP) is 8 / 10 and the dividend payout ratio is 45.33%.