We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Union Pacific (UNP) Q4 Earnings Surpass Estimates, Rise Y/Y
Read MoreHide Full Article
Union Pacific Corporation’s (UNP - Free Report) fourth-quarter 2020 earnings (excluding 31 cents from non-recurring items) of $2.36 per share beat the Zacks Consensus Estimate of $2.25. Moreover, the bottom line improved 16.8% on a year-over-year basis.
Operating revenues of $5,141 million also marginally beat the Zacks Consensus Estimate. However, the top line dipped 1% on a year-over-year basis due to the reduction in freight revenues (down 1% to $4,803 million). However, the decline in freight revenues was much less than the 11% fall witnessed in third-quarter 2020. This reflects the improving freight conditions in the United States. Moreover, business volumes, measured by total revenue carloads, improved 3% year over year.
Operating income in the fourth quarter slid 4% year over year to $2,006 million. Operating expenses inched up 1% to $3,135 million. Meanwhile, operating ratio (operating expenses as a percentage of revenues) came in at 61% in the final quarter of 2020 on a GAAP basis. However, after adjusting the $278-million impairment charge, the metric improved 410 basis points on a year-over-year basis to 55.6%. Operating ratio in fourth-quarter 2020 was positively impacted to the tune of 90 basis points on lower fuel prices. Notably, lower the value of the metric the better.
Moreover, this currently Zacks Rank #3 (Hold) company’s fourth-quarter effective tax rate declined to 23% from 25.3% a year ago. In the fourth quarter, Union Pacific repurchased 3.8 million shares at an aggregate cost of $749 million.
Bulk (Grain & grain products, Fertilizer, Food & refrigerated, Coal & renewables) freight revenues were $1,562 million, up 1% year over year. Moreover, average revenue per car increased 1% year over year. Meanwhile, revenue carloads were flat year over year.
Industrial freight revenues totaled $1,661 million, down 7% year over year. Also, revenue carloads fell 6% and average revenue per car slid 2% on a year-over-year basis.
Freight revenues in the Premium division were $1,580 million, up 5% year over year. Moreover, revenue carloads rose 9% year over year. Average revenue per car, however, declined 4%.
Meanwhile, other revenues slipped 6% to $338 million in the fourth quarter.
Liquidity
The company exited the fourth quarter of 2020 with cash and cash equivalents of $1,799 million compared with $831 million at the end of 2019. Debt (due after a year) increased to $25,660 million at the end of the quarter from $23,943 million at 2019-end. Debt-to-EBITDA ratio (on an adjusted basis) deteriorated to 2.9 from 2.5 at 2019-end
Annual Results
For the full year, the company’s earnings (on an adjusted basis) came in at $8.19 per share. Revenues decreased 10.1% year over year to $19.5 billion. The Zacks Consensus Estimate for earnings was $8.06 per share while the same for revenues was $19.5 billion. Total capital investments were $2,927 million in 2020
Upcoming Railroad Releases
Investors interested in the Zacks Transportation – Rail industry will be keenly awaiting the fourth-quarter 2020 earnings reports of key players, namely Kansas City Southern , NorfolkSouthernCorporation (NSC - Free Report) and CanadianPacificRailwayLimited (CP - Free Report) .
While Kansas City Southern will announce fourth-quarter 2020 results on Jan 22, Norfolk Southern and Canadian Pacific Railway Limited will release financial numbers on Jan 27
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
Image: Bigstock
Union Pacific (UNP) Q4 Earnings Surpass Estimates, Rise Y/Y
Union Pacific Corporation’s (UNP - Free Report) fourth-quarter 2020 earnings (excluding 31 cents from non-recurring items) of $2.36 per share beat the Zacks Consensus Estimate of $2.25. Moreover, the bottom line improved 16.8% on a year-over-year basis.
Operating revenues of $5,141 million also marginally beat the Zacks Consensus Estimate. However, the top line dipped 1% on a year-over-year basis due to the reduction in freight revenues (down 1% to $4,803 million). However, the decline in freight revenues was much less than the 11% fall witnessed in third-quarter 2020. This reflects the improving freight conditions in the United States. Moreover, business volumes, measured by total revenue carloads, improved 3% year over year.
Operating income in the fourth quarter slid 4% year over year to $2,006 million. Operating expenses inched up 1% to $3,135 million. Meanwhile, operating ratio (operating expenses as a percentage of revenues) came in at 61% in the final quarter of 2020 on a GAAP basis. However, after adjusting the $278-million impairment charge, the metric improved 410 basis points on a year-over-year basis to 55.6%. Operating ratio in fourth-quarter 2020 was positively impacted to the tune of 90 basis points on lower fuel prices. Notably, lower the value of the metric the better.
Moreover, this currently Zacks Rank #3 (Hold) company’s fourth-quarter effective tax rate declined to 23% from 25.3% a year ago. In the fourth quarter, Union Pacific repurchased 3.8 million shares at an aggregate cost of $749 million.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Segmental Performance
Bulk (Grain & grain products, Fertilizer, Food & refrigerated, Coal & renewables) freight revenues were $1,562 million, up 1% year over year. Moreover, average revenue per car increased 1% year over year. Meanwhile, revenue carloads were flat year over year.
Industrial freight revenues totaled $1,661 million, down 7% year over year. Also, revenue carloads fell 6% and average revenue per car slid 2% on a year-over-year basis.
Freight revenues in the Premium division were $1,580 million, up 5% year over year. Moreover, revenue carloads rose 9% year over year. Average revenue per car, however, declined 4%.
Meanwhile, other revenues slipped 6% to $338 million in the fourth quarter.
Liquidity
The company exited the fourth quarter of 2020 with cash and cash equivalents of $1,799 million compared with $831 million at the end of 2019. Debt (due after a year) increased to $25,660 million at the end of the quarter from $23,943 million at 2019-end. Debt-to-EBITDA ratio (on an adjusted basis) deteriorated to 2.9 from 2.5 at 2019-end
Annual Results
For the full year, the company’s earnings (on an adjusted basis) came in at $8.19 per share. Revenues decreased 10.1% year over year to $19.5 billion. The Zacks Consensus Estimate for earnings was $8.06 per share while the same for revenues was $19.5 billion. Total capital investments were $2,927 million in 2020
Upcoming Railroad Releases
Investors interested in the Zacks Transportation – Rail industry will be keenly awaiting the fourth-quarter 2020 earnings reports of key players, namely Kansas City Southern , Norfolk Southern Corporation (NSC - Free Report) and Canadian Pacific Railway Limited (CP - Free Report) .
While Kansas City Southern will announce fourth-quarter 2020 results on Jan 22, Norfolk Southern and Canadian Pacific Railway Limited will release financial numbers on Jan 27
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>