Baird Resumes Coverage of Union Pacific (UNP) Stock With a Neutral Rating

Union Pacific Corporation (NYSE:UNP) is one of the Top 10 Transportation and Industrial Stocks to Buy Now. Baird resumed coverage of the company’s stock with a “Neutral” rating and a price objective of $231, as reported by The Fly. The firm is resuming coverage on the broader trucking, logistics, and rail sectors and has a constructive, but balanced view of the near-term headwinds, risks, and earnings prospects. Furthermore, the firm’s analyst highlighted that the conditions that typically precede a turn are largely in place. However, how the remainder of 2025 unfolds is still uncertain.

In Q1 2025, Union Pacific Corporation (NYSE:UNP)’s operating revenue came in at $6.0 billion, which remained flat on 7% volume growth, while strong core pricing gains were offset by business mix, reduced fuel surcharge revenue, lower other revenue, as well as impact from the leap year. Freight revenue of $5.7 billion rose 1% despite a ~$70 million impact of having one less day in the quarter. Talking about the freight revenue drivers, Union Pacific Corporation (NYSE:UNP)’s robust volume growth in Q1 2025 added 650 bps to the freight revenue.

Union Pacific Corporation (NYSE:UNP) has affirmed its 2025 outlook. Its 2025 EPS growth is expected to be consistent with attaining its 3-year EPS CAGR view of high single to low double-digit growth. Bretton Capital Management, an investment management company, released its Q4 2024 investor letter. Here is what the fund said:

“The main detractor was Dream Finders, taking 1.5% off the fund, and Union Pacific Corporation (NYSE:UNP) was a minor detractor with a -0.2% impact. The rail industry has seen tepid revenue growth the past few years as higher-revenue coal volume declines and is replaced by lower-revenue intermodal volume sourced from ocean and truck carriers. Despite the growth challenge, Union Pacific managed to cut costs and grow earnings per share by 6%. The stock returned -5%.”

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Disclosure: None. This article is originally published at Insider Monkey.