Union Pacific Corporation Readies for Third-Quarter Earnings Announcement
Union Pacific Corporation (UNP) is set to release its third-quarter 2024 earnings on October 24 before the market opens.
Discover the latest EPS estimates and surprises on ZacksEarnings Calendar.
Impressive Earnings Record
Union Pacific has consistently surprised analysts, exceeding the Zacks Consensus Estimate in all four of its previous quarters, with an average beat of 4.4%.
Current Earnings Expectations
Union Pacific Corporation price-eps-surprise | Union Pacific Corporation Quote
For the upcoming quarter, analysts have slightly lowered their earnings estimates by 0.4% over the last 60 days to $2.76 per share. Revenue forecasts are set at $6.19 billion, reflecting a 4.2% increase compared to the same period last year.
Challenges and Opportunities Ahead
Union Pacific’s performance may be impacted by the ongoing struggles in the freight market and a weakening consumer sector. Freight revenues are estimated to be around $5.7 billion, showing little to no change from the second quarter of 2024. Additionally, other revenue sources are expected to contribute $407 million.
However, the company is positioned to see improvements thanks to enhanced operational efficiency, better core pricing, and sales of intermodal equipment during the September quarter. Our predicted adjusted operating expenses reflect a 2% decrease compared to the same quarter last year.
Financial Ratios Improve
Due to the anticipated reduction in costs, Union Pacific’s operating ratio (operating expenses as a percentage of revenues) is expected to improve. For this quarter, we expect the operating ratio to be 60.3%, down from 63.4% a year ago. A lower operating ratio is generally seen as a positive sign for a company’s efficiency.
Our Prediction Model’s Insights
Current models do not strongly suggest Union Pacific will exceed earnings expectations this quarter. A favorable combination of Earnings ESP and Zacks Rank #1 (Strong Buy), #2 (Buy), or #3 (Hold) typically indicates better odds for an earnings beat, which is not the case at this moment.
Presently, UNP holds an Earnings ESP of -0.20% and a Zacks Rank of #3. Investors can utilize our Earnings ESP Filter to discover top stocks ahead of their earnings reports.
Recap of Q2 Performance
In its second quarter of 2024, Union Pacific reported earnings of $2.74 per share, beating the Zacks Consensus Estimate of $2.70. This was a 6.61% rise compared to the previous year, driven by operational efficiency and favorable pricing strategies.
Operating revenues reached $6 billion, slightly missing the consensus estimate of $6.06 billion. Although revenues improved by 0.74% year-over-year due to increased core pricing, this was partly offset by reduced fuel surcharge revenues.
Other Notable Stocks
Investors may also consider other stocks within the broader Zacks Transportation sector that could perform well in the third quarter of 2024.
JetBlue Airways (JBLU) has an Earnings ESP of +18.66% and a Zacks Rank of #3, with earnings to be reported on October 29.
JBLU has exceeded consensus estimates in three of its last four quarters, achieving an average earnings beat of 42%.
American Airlines (AAL) boasts an Earnings ESP of +32.97% and a Zacks Rank of #2. AAL is also set to announce its earnings on October 24.
American Airlines has a strong earnings surprise history, beating estimates three out of the last four quarters with an average beat of 103.2%.
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