Union Pacific Stock

[CMStPnP]

Well judging from the price of UP RR stock looks like Wall Street was impressed with UP RR ability to weather the downturn in Coal and Oil traffic.    I hope it is short lived and reverses itself at some point in the not too distant future.

[kgbw49]

It is up about $22 from its 52 week low of $67.

They have 15% of their locomotive fleet iin storage per their 1st Quarter Earnings presentation.

[dakotafred]

CMStPnP

Well judging from the price of UP RR stock looks like Wall Street was impressed with UP RR ability to weather the downturn in Coal and Oil traffic.    I hope it is short lived and reverses itself at some point in the not too distant future.

 

What -- you hope it goes down? What are you getting at?

[Anonymous]

I think he is refering to the amount of coal and oil traffic.

[dakotafred]

Got it.

[croteaudd]

Coal traffic probably won't come back for environmental reasons.  And, oil prices is at the mercy of OPEC which keeps the prices down so that there is little incentive for American oil producers to produce oil.  Catch-22.  When all U.S. oil people go away and all their equipment is rusting, will OPEC then raise prices through the roof?

[PJS1]

UP closed on April 22^nd at $89.63, up from a 52 week low of $67.06 but down from a 52 week high of $110.78.  The price performance over the last year declined 20.3 per cent. 

 

UP’s stock is up in part because the market is up, but it is also up because the company’s fundamentals are better than many people seem to believe.

 

UP’s gross margin for the most recent quarter was 45.3%, down from 46.5% for the Trailing Twelve Months (TTM).

 

The operating margin was 34.3%, down from 36.9% for the TTM.  The pre-tax margin for the most recent quarter was 32.4%, down from 35.0% for the first quarter 2015.   

 

Return on sales for the most recent quarter annualized was 20.3%, down from a TTM of 21.9%. 

 

Return on equity was 19.1%, down from a TTM of 22.2%.  Return on investment was 7.7%, down from a TTM of 9.2%.

 

Net income in 2015 was 92.1 per cent of 2014 net income, but it was 109 per cent of 2013 net income. 

 

UP’s 2015 cash flows from operations were down slightly from 2014 – 1.2 per cent, but they were 108 per cent of 2013 cash flows.  The company’s 2015 cash balances shrank by $194 million, due largely to increases of $304 million in capital expenditures, $712 million in dividends, and $240 million in share buybacks, offset in part by an $894 million increase in long-term debt.

 

UP’s financial reverses in 2015 were relatively mild.  What comes next, of course, no one knows, but UP will adapt to the changes required to remain a viable company.  This is not the first challenge that it has faced; it won’t be the last.  

 

Apparently many investors – 79.4 per cent of the stock is held by institutions - realized that the sky has not fallen, and the sell-off of the company’s shares was overdone. So they have bid up the price of the company’s stock off it’s 52 week low point.