Company Overview
Union Pacific is a freight railroad that moves bulk and industrial goods across a large U.S. rail network. The business is built around hauling carload freight and intermodal shipments, using its track infrastructure, terminals, and locomotives to move volume efficiently. Its model depends on keeping the network fluid while running long-lived assets hard and safely. Over time, results tend to be shaped by how well it balances pricing, volume, and ongoing reinvestment in the network.
Analysis of recent data
FundamentalsFor 2025, reported in U.S. dollars, revenue was about USD 24.5 billion, with EBIT of roughly USD 9.8 billion and net income of around USD 7.1 billion. Revenue grew 1.1% year over year, with a 79.53% gross margin, a 40.17% operating margin, and a 29.12% net profit margin on a trailing basis.
Cash generation, as approximated by the cash flow proxy, was about USD 10.3 billion, supported by USD 2.5 billion of depreciation and amortization. Cash on hand ended at roughly USD 1.3 billion, while trailing ROE was 41.95%.
Valuation
DCF / MultiplesWith the stock at USD 238.79, the DCF range runs from USD 114.10 in a weaker outcome through USD 157.42 at the midpoint to USD 201.55 in a stronger outcome, placing the current price above the top end of that range. Headline pricing also sits alongside a 19.91 P/E and 13.37 EV/EBITDA on trailing results.
Conclusion
TakeawayOperations are already running at very high margin levels. The current price assumes more than the DCF outcomes shown. For the story to work, cash generation must stay durable. Reinvestment has to protect service without eroding efficiency. If volumes soften, the valuation has less room for mistakes.