With a market capitalization of $135.9 billion, Union Pacific Corporation (UNP) is one of the largest freight rail operators in North America, managing a vast rail network across 23 U.S. states and linking major West Coast and Gulf Coast ports with key inland distribution centers and gateways to Mexico. Through its Union Pacific Railroad subsidiary, the Nebraska-based company transports a wide range of goods, including agricultural products, industrial products, chemicals, automobile shipments, energy resources and intermodal containers, to more than 10,000 customers.
Companies valued at $10 billion or more are generally considered “large-cap” stocks, and Union Pacific fits this bill perfectly. As the critical backbone of U.S. supply chains and trade infrastructure, Union Pacific plays an important role in supporting international manufacturing, agriculture and logistics.
Despite this, the company’s shares have fallen 10.2% from their 52-week high of $256.84 reached on January 27. UNP shares have risen 3.6% over the past three months, lagging the broader Dow Jones Industrial Average ($DOWI)’s 4.4% gain over the same time period.
Longer term, Union Pacific shares are up 1.2% year over year, lagging $DOWI’s 11.5% gain. Additionally, railroad shares have fallen 6.1% over the past 52 weeks, compared to the Dow Jones’ rise of 5.7% over the same period.
Despite significant fluctuations, UNP stock has recently risen above its 50-day and 200-day moving averages.
Union Pacific posted better-than-expected third-quarter results on Oct. 23, but its shares still fell 2.3% in the following trading session. The rail operator delivered solid price improvements that largely offset lower fuel surcharge revenues. Total revenue rose 2.8% year over year to $5.9 billion, beating consensus estimates by 16 basis points. Additionally, adjusted earnings per share rose 12% year-over-year to $3.08, beating Wall Street expectations by 3%.
By contrast, rival Norfolk Southern Corporation (NSC) has outperformed UNP stock. Norfolk Southern shares have soared 23.6% year to date and 5.1% over the past 52 weeks.