UNP
Union Pacific Corporation
Industrials · Railroads · United States · Stock
Score Breakdown
Scored for Dividend Income profile
Sub-scores are 0–20 each; Model Score is weighted by your selected investment goal. How it works →
Why Ranked Here
- The near-perfect profitability score anchors the composite, reflecting the company's exceptional 40.2% operating margin, 29.1% net margin, and 10.2% return on assets in FY2025.
- Growth and financial health scores landed at the midpoint range, with revenue expanding only +1.1% in FY2025 and the financial health factor not providing additional uplift.
- Mixed momentum — stable revenues but declining net income from $1,876,000,000 in 2025Q2 to $1,701,000,000 in 2026Q1 — and the absence of a macro theme assignment both weighed on the composite, resulting in a total score of 59.6/100.
Why Not Higher
- Revenue growth of only +1.1% in FY2025 and a gradual softening in quarterly net income and operating income prevented stronger growth and momentum scores, limiting the composite.
- The absence of any macro theme assignment means Union Pacific receives no thematic scoring contribution, which constrains the total score relative to peers that are aligned with tracked macro trends.
Data Confidence
10 / 10
Very High — full data coverage
Why This Score
Grounded in figures from this company's SEC EDGAR filings — not a restatement of the score itself.
Revenue grew modestly from FY2024 to FY2025, rising +1.1% to $24,510,000,000, while net income increased +5.8% and diluted EPS improved +8.0% (from $11.09 in FY2024 to $11.98 in FY2025).
The model appears to reward the earnings-per-share and net income growth, but the relatively modest top-line revenue expansion of +1.1% from FY2024 to FY2025 likely tempered the overall growth score to the midpoint range.
In FY2025, Union Pacific reported an operating margin of 40.2%, a net margin of 29.1%, and a return on assets of 10.2%.
These figures reflect exceptional capital efficiency and pricing power; a 40.2% operating margin and 29.1% net margin in FY2025 are hallmarks of a wide-moat business, which the model rewards with a near-perfect profitability score.
Filing evidence currently available does not support a more specific explanation for this factor.
Over the last four reported quarters, revenue ranged from $6,085,000,000 in 2025Q4 to $6,244,000,000 in 2025Q3, with 2026Q1 at $6,217,000,000, showing general stability with no clear acceleration. Net income declined from $1,876,000,000 in 2025Q2 to $1,701,000,000 in 2026Q1, and operating income similarly dipped from $2,549,000,000 in 2025Q3 to $2,458,000,000 in 2026Q1.
The model reflects a mixed trend: revenue has been relatively stable quarter to quarter, but the gradual softening in net income and operating income over the trailing four quarters likely prevented a higher momentum score.
Union Pacific has grown its dividends per share each year from $5.08 in FY2022 to $5.20 in FY2023, $5.28 in FY2024, and $5.44 in FY2025, while maintaining a dividend payout ratio of 45.3% of net income in FY2025.
The consistent multi-year dividend growth and a payout ratio of 45.3% in FY2025 suggest a balance between rewarding shareholders and retaining earnings, which the model recognizes with an above-midpoint dividend score.
Union Pacific is not currently assigned to any of the 24 tracked macro themes in the model.
The absence of a macro theme assignment is a neutral characteristic of the model's current classification; it does not reflect negatively on the company's business or prospects.
Research Summary
AI-generated analysis reflects data and conditions as of the report date shown above. Verify any specific figures through primary sources before acting on this analysis.
Union Pacific Corporation earned a composite score of 59.6/100 with a Medium risk rating and a 'Research Further' label, reflecting a business with exceptional profitability but modest revenue growth and mixed near-term momentum. In FY2025, the company posted a 40.2% operating margin and 29.1% net margin, underscoring its wide-moat competitive position, while revenue grew only +1.1% year-over-year to $24,510,000,000. Earnings growth was stronger, with net income rising +5.8% and diluted EPS improving +8.0% to $11.98, and the company continued its multi-year streak of dividend increases, reaching $5.44 per share in FY2025. However, softening quarterly net income and operating income trends, combined with the absence of a macro theme assignment, tempered the overall composite score.
Plain English
Union Pacific is an extremely profitable railroad — it keeps about 29 cents of profit for every dollar of revenue — but its sales are barely growing and recent quarterly earnings have been drifting lower, which is why the overall score lands in the middle of the range rather than near the top.
Bull Case vs. Bear Case
Bull Case
- Exceptional profitability: Union Pacific reported a 40.2% operating margin and 29.1% net margin in FY2025, alongside a 10.2% return on assets, reflecting strong pricing power and capital efficiency that are hallmarks of a wide-moat business.
- Consistent dividend growth: Dividends per share have risen every year from $5.08 in FY2022 to $5.44 in FY2025, with a payout ratio of 45.3% in FY2025, suggesting the company balances shareholder returns with retained earnings for reinvestment.
- Earnings outpacing revenue: Despite modest top-line growth of +1.1%, net income grew +5.8% and diluted EPS improved +8.0% from $11.09 to $11.98 in FY2025, indicating improving operational leverage and efficiency.
Bear Case
- Weak revenue growth: Top-line revenue expanded only +1.1% from FY2024 to FY2025, reaching $24,510,000,000, which limits the growth score and signals limited near-term volume or pricing acceleration.
- Softening quarterly momentum: Net income declined from $1,876,000,000 in 2025Q2 to $1,701,000,000 in 2026Q1, and operating income similarly dipped from $2,549,000,000 in 2025Q3 to $2,458,000,000 in 2026Q1, reflecting a gradual weakening trend.
- No macro theme tailwind: Union Pacific is not currently assigned to any of the 24 tracked macro themes in the model, meaning it does not benefit from a thematic scoring boost that could lift the composite score.
What Could Change the Picture
Bullish Triggers
- A reacceleration in quarterly revenue and net income growth — reversing the recent softening trend seen from 2025Q2 through 2026Q1 — would signal improving business momentum and could support a higher composite score.
- Assignment to one or more of the model's 24 tracked macro themes could provide an additional scoring tailwind that is currently absent.
Bearish Triggers
- A further deceleration in revenue growth below the already modest +1.1% annual rate, or continued quarterly declines in net income and operating income, would reinforce concerns about the company's near-term trajectory.
- Any deterioration in the profitability metrics — particularly the 40.2% operating margin or 29.1% net margin — that are currently the primary driver of the high profitability score would materially weaken the investment case.
Risk Profile
Medium RiskThe medium risk rating reflects a combination of mixed momentum signals — with net income declining from $1,876,000,000 in 2025Q2 to $1,701,000,000 in 2026Q1 — alongside a debt-to-equity ratio of 1.72 in FY2025, which indicates meaningful financial leverage against a total asset base of $69,698,000,000.
This report is for educational and research purposes only. It does not constitute financial, investment, legal, or tax advice — always conduct your own due diligence before making investment decisions.