Union Pacific trending higher with solid fundamentals
One of the tenets of Dow Theory was to watch how transportation stocks were performing as a forecasting tool for how industrial stocks were doing. The idea being that if transportation companies started seeing slower growth, it was a bad sign for industrial companies. That idea works in reverse as well, when transportation companies start seeing stronger growth, industrial companies are likely to follow.
Right now there are several rail transportation companies that are showing really strong fundamentals and Union Pacific (NYSE: UNP) is one of them. Over the last three years the company has seen earnings grow by 21% per year and earnings were up 12% in the most recent quarterly report. In addition to the earnings growth, the company has really good management efficiency measurements with a return on equity of 26.4% and a profit margin of 33.9%.
The Tickeron PE Growth Rating for this company is 9, pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents. A rating of 1 indicates highest PE growth while a rating of 100 indicates lowest PE growth. Furthermore, the PEG ratio is (0.1) for UNP, as compared to the industry average of (0.3).
Looking at the chart for Union Pacific we see that the stock has been trending higher since the December low, but the last six months have seen a trend line help guide the stock higher. The trend line connects the lows from March, June, July, and this past week.
The stock hitting the trend line is one possible bullish catalyst for the stock and another one is the daily stochastic readings getting close to oversold territory before making a bullish crossover on August 9. There were similar readings from the indicators at the June low as well as the March low.
We also see from the Tickeron Overview on Union Pacific that “the lower Bollinger Band was broken -- a price increase is expected as the ticker heads toward the middle band, which indicates a buy or call consideration for traders. In 22 of 39 cases where UNP's price broke its lower Bollinger Band, its price rose further in the following month. The odds of a continued Uptrend are 56%.”
Another interesting stat that I noticed from the Tickeron Overview was the fact that the stock’s 50-day moving average made a bullish cross of its 200-day on September 28, 2017 and it has remained there ever since.
Looking at the sentiment indicators for Union Pacific we see that analysts are slightly less bullish on the stock than the average stock while short sellers are slightly more bullish. There are 26 analysts following the stock at this time and 16 of them have the stock rated as a “buy”. There are nine “hold” ratings and one “sell” rating. This puts the overall buy percentage at 61.5% and the average buy percentage seems to be in the 65% to 75%.
The short interest ratio is currently at 2.0 and that is a little below average. There are 5.76 million shares sold short and that number jumped by almost a million shares from the mid-July reading to the end of July reading. The ratio is a little low, but the big jump in the overall short interest indicates an increasing bearish view.
The overall picture for Union Pacific seems to be pretty bullish. The fundamentals and the technical picture both look good while the sentiment is mixed. The path of least resistance for the stock could be to the upside.
UNP in upward trend: 10-day moving average moved above 50-day moving average on May 20, 2025
The 10-day moving average for UNP crossed bullishly above the 50-day moving average on May 20, 2025. This indicates that the trend has shifted higher and could be considered a buy signal. In of 18 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator is in the oversold zone. Keep an eye out for a move up in the foreseeable future.
The Momentum Indicator moved above the 0 level on June 18, 2025. You may want to consider a long position or call options on UNP as a result. In of 91 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
UNP moved above its 50-day moving average on June 06, 2025 date and that indicates a change from a downward trend to an upward trend.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where UNP advanced for three days, in of 333 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 231 cases where UNP Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The Moving Average Convergence Divergence Histogram (MACD) for UNP turned negative on June 17, 2025. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 48 similar instances when the indicator turned negative. In of the 48 cases the stock turned lower in the days that followed. This puts the odds of success at .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where UNP declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
UNP broke above its upper Bollinger Band on June 10, 2025. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 76, placing this stock slightly better than average.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating fairly steady price growth. UNP’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: UNP's P/B Ratio (8.292) is slightly higher than the industry average of (2.187). P/E Ratio (20.046) is within average values for comparable stocks, (18.059). Projected Growth (PEG Ratio) (2.803) is also within normal values, averaging (3.430). Dividend Yield (0.024) settles around the average of (0.038) among similar stocks. UNP's P/S Ratio (5.565) is slightly higher than the industry average of (2.353).
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Fundamental Analysis Ratings
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General Information
a provider of railroad and freight transportation services
Industry Railroads
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