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.
Here's How Much You'd Have If You Invested $1000 in Union Pacific a Decade Ago
Read MoreHide Full Article
How much a stock's price changes over time is important for most investors, since price performance can both impact your investment portfolio and help you compare investment results across sectors and industries.
Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.
What if you'd invested in Union Pacific (UNP - Free Report) ten years ago? It may not have been easy to hold on to UNP for all that time, but if you did, how much would your investment be worth today?
Union Pacific's Business In-Depth
With that in mind, let's take a look at Union Pacific's main business drivers.
Union Pacific Corporation provides rail transportation services across 23 states in the United States through its principal operating company, Union Pacific Railroad Company. As the largest railroad in North America, Union Pacific connects the Pacific and Gulf Coast ports with the Midwest and gateways in eastern United States.
The company also connects with Canada's rail systems and is the only railroad, serving all the six major gateways to Mexico. Union Pacific offers transportation services for agricultural products, automotive, lumber, steel, paper, food, chemicals, coal, and industrial products, as well as for finished vehicles and intermodal containers.
Union Pacific, based in Omaha, NE, also provides container and traffic services, primarily for shipper agents and consolidators, as well as for truckload carriers. The company was incorporated in Utah in 1969.
From first-quarter 2020, Union Pacific has been reporting through three business groups: Bulk (formerly agricultural products), Industrial and Premium.
The bulk division (33% of freight revenues generated in 2021) is responsible for the transportation of grains, commodities produced from these grains, fertilizer apart from food and beverage products.
The segment serves major grain markets, linking the Midwest and Western United States producing areas to export terminals in the Pacific Northwest and Gulf Coast ports and Mexico. The coal and petroleum coke products also come under the bulk group.
The Industrial unit (36%) includes multiple categories like construction, industrial chemicals and soda ash. The company’s premium division includes three segments, namely international intermodal, domestic intermodal and finished vehicles. Meanwhile, LPG, petroleum and sand products also fall under its Industrial business.
The company’s premium division (31%) includes three segments, namely international intermodal, domestic intermodal and automotive. Freight revenues account for bulk of the company's top line. In 2021, 92.7% of the company’s total revenues of $21,804 million came from this source.
The company's fiscal year coincides with the calendar year.
Bottom Line
Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in Union Pacific ten years ago, you're likely feeling pretty good about your investment today.
A $1000 investment made in March 2012 would be worth $4,916.52, or a gain of 391.65%, as of March 24, 2022, according to our calculations. This return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 218.96% and the price of gold went up 12.55% over the same time frame.
Going forward, analysts are expecting more upside for UNP.
Union Pacific's efforts to reward its shareholders even in the current uncertain scenario please us. The company hiked dividend twice in 2021. The railroad operator is also active on the buyback front. Management anticipates share repurchases in 2022 to be in line with the 2021 levels of $7.3 billion. The company's strong free cash flow generating ability supports its shareholder-friendly activities. Uptick in freight revenues (up 11% year over year in 2021) as economic activities pick up the pace is an added positive. However, escalation in fuel costs (up 56% in 2021) as oil prices move north induced a 7% rise in operating expenses. High debt/EBITDA ratio and tepid automotive demand are further concerns. Moreover, Union Pacific's operations in the near term are likely to be impacted by the omicron-induced volatility.
Shares have gained 9.34% over the past four weeks and there have been 3 higher earnings estimate revisions for fiscal 2022 compared to none lower. The consensus estimate has moved up as well.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Here's How Much You'd Have If You Invested $1000 in Union Pacific a Decade Ago
How much a stock's price changes over time is important for most investors, since price performance can both impact your investment portfolio and help you compare investment results across sectors and industries.
Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.
What if you'd invested in Union Pacific (UNP - Free Report) ten years ago? It may not have been easy to hold on to UNP for all that time, but if you did, how much would your investment be worth today?
Union Pacific's Business In-Depth
With that in mind, let's take a look at Union Pacific's main business drivers.
Union Pacific Corporation provides rail transportation services across 23 states in the United States through its principal operating company, Union Pacific Railroad Company. As the largest railroad in North America, Union Pacific connects the Pacific and Gulf Coast ports with the Midwest and gateways in eastern United States.
The company also connects with Canada's rail systems and is the only railroad, serving all the six major gateways to Mexico. Union Pacific offers transportation services for agricultural products, automotive, lumber, steel, paper, food, chemicals, coal, and industrial products, as well as for finished vehicles and intermodal containers.
Union Pacific, based in Omaha, NE, also provides container and traffic services, primarily for shipper agents and consolidators, as well as for truckload carriers. The company was incorporated in Utah in 1969.
From first-quarter 2020, Union Pacific has been reporting through three business groups: Bulk (formerly agricultural products), Industrial and Premium.
The bulk division (33% of freight revenues generated in 2021) is responsible for the transportation of grains, commodities produced from these grains, fertilizer apart from food and beverage products.
The segment serves major grain markets, linking the Midwest and Western United States producing areas to export terminals in the Pacific Northwest and Gulf Coast ports and Mexico. The coal and petroleum coke products also come under the bulk group.
The Industrial unit (36%) includes multiple categories like construction, industrial chemicals and soda ash. The company’s premium division includes three segments, namely international intermodal, domestic intermodal and finished vehicles. Meanwhile, LPG, petroleum and sand products also fall under its Industrial business.
The company’s premium division (31%) includes three segments, namely international intermodal, domestic intermodal and automotive. Freight revenues account for bulk of the company's top line. In 2021, 92.7% of the company’s total revenues of $21,804 million came from this source.
The company's fiscal year coincides with the calendar year.
Bottom Line
Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in Union Pacific ten years ago, you're likely feeling pretty good about your investment today.
A $1000 investment made in March 2012 would be worth $4,916.52, or a gain of 391.65%, as of March 24, 2022, according to our calculations. This return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 218.96% and the price of gold went up 12.55% over the same time frame.
Going forward, analysts are expecting more upside for UNP.
Union Pacific's efforts to reward its shareholders even in the current uncertain scenario please us. The company hiked dividend twice in 2021. The railroad operator is also active on the buyback front. Management anticipates share repurchases in 2022 to be in line with the 2021 levels of $7.3 billion. The company's strong free cash flow generating ability supports its shareholder-friendly activities. Uptick in freight revenues (up 11% year over year in 2021) as economic activities pick up the pace is an added positive. However, escalation in fuel costs (up 56% in 2021) as oil prices move north induced a 7% rise in operating expenses. High debt/EBITDA ratio and tepid automotive demand are further concerns. Moreover, Union Pacific's operations in the near term are likely to be impacted by the omicron-induced volatility.
Shares have gained 9.34% over the past four weeks and there have been 3 higher earnings estimate revisions for fiscal 2022 compared to none lower. The consensus estimate has moved up as well.