UNP
UNP
Hold 2026-04-07
Model
DCF
Price at Report
$245.74
Base IV
$230.87
Bear IV
$139.59
Bull IV
$345.94
Entry Zone: 133-212 · Sell Above: 294
Bore Family Office
Valuation Report — Union Pacific (UNP) • April 7, 2026
Unlevered DCF (FCFF @ WACC) • Discount Rate: 7.50% • Current Price: $245.74
Prepared by Lurch • Bore Family Office • Data: Finnhub, StockAnalysis.com, S&P Global Market Intelligence
🏢 Business Overview
Union Pacific is a Class I railroad; operates transcontinental network across US; major freight carrier (intermodal, grain, coal, chemicals, etc.).
📊 Business Lifecycle Stage
Stage 1
Startup
Startup
Stage 2
Hyper Growth
Hyper Growth
Stage 3
Self Funding
Self Funding
Stage 4
Operating Leverage
Operating Leverage
Stage 5
Capital Return
Capital Return
Stage 6
Decline
Decline
Stage 3 — Mature Utility-Like: Revenue growing rapidly, approaching breakeven. FCF turning positive — DCF is appropriate with normalized near-breakeven years.
Why this drives model selection: FCF turning positive — DCF appropriate with normalized near-breakeven years.
📈 DCF Scenarios
$140
🔴 Bear
$231
📊 Base
$346
🚀 Bull
$245.74
Current Price
$263
Analyst Avg PT
| Scenario | Stage 1 (Yrs 1–5) | Stage 2 (Yrs 6–10) | Terminal g | WACC | Intrinsic Value | vs Price |
|---|---|---|---|---|---|---|
| 🔴 Bear | 1.0% | 1.0% | 2.5% | 7.50% | $140 | ▼43.2% |
| 📊 Base | 4.0% | 3.0% | 3.0% | 7.50% | $231 | ▼6.1% |
| 🚀 Bull | 7.0% | 5.0% | 3.5% | 7.50% | $346 | ▲40.8% |
📋 Full 10-Year Projection Tables
Bear Scenario
Stage 1: 1.0% | Stage 2: 1.0% | Terminal: 2.5%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 ✦ | Stage 1 | $5.20B | $4.84B | $4.84B |
| Year 2 ✦ | Stage 1 | $5.10B | $4.41B | $9.25B |
| Year 3 ✦ | Stage 1 | $5.15B | $4.15B | $13.40B |
| Year 4 ✦ | Stage 1 | $5.25B | $3.93B | $17.33B |
| Year 5 ✦ | Stage 1 | $5.40B | $3.76B | $21.09B |
| Year 6 | Stage 2 | $5.45B | $3.53B | $24.62B |
| Year 7 | Stage 2 | $5.51B | $3.32B | $27.94B |
| Year 8 | Stage 2 | $5.56B | $3.12B | $31.06B |
| Year 9 | Stage 2 | $5.62B | $2.93B | $33.99B |
| Year 10 | Stage 2 | $5.68B | $2.75B | $36.75B |
| Terminal | — | TV=$116.3B | PV(TV)=$56.5B (61% of EV) | EV=$93.2B |
| Intrinsic Value | — | — | EV $93.2B − Net Debt → Equity / Shares | $140 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (7.50%) to get its present value. After Year 10, FCF grows at the terminal rate (2.5%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $116.3B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $56.5B). Enterprise Value = PV of FCFs ($36.7B) + PV of TV ($56.5B) = $93.2B. Subtracting net debt gives equity value of $83.2B, divided by shares outstanding = $140 per share.
Base Scenario
Stage 1: 4.0% | Stage 2: 3.0% | Terminal: 3.0%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 ✦ | Stage 1 | $5.70B | $5.30B | $5.30B |
| Year 2 ✦ | Stage 1 | $6.10B | $5.28B | $10.58B |
| Year 3 ✦ | Stage 1 | $6.55B | $5.27B | $15.85B |
| Year 4 ✦ | Stage 1 | $7.05B | $5.28B | $21.13B |
| Year 5 ✦ | Stage 1 | $7.60B | $5.29B | $26.43B |
| Year 6 | Stage 2 | $7.83B | $5.07B | $31.50B |
| Year 7 | Stage 2 | $8.06B | $4.86B | $36.36B |
| Year 8 | Stage 2 | $8.30B | $4.66B | $41.01B |
| Year 9 | Stage 2 | $8.55B | $4.46B | $45.48B |
| Year 10 | Stage 2 | $8.81B | $4.27B | $49.75B |
| Terminal | — | TV=$201.7B | PV(TV)=$97.8B (66% of EV) | EV=$147.6B |
| Intrinsic Value | — | — | EV $147.6B − Net Debt → Equity / Shares | $231 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (7.50%) to get its present value. After Year 10, FCF grows at the terminal rate (3.0%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $201.7B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $97.8B). Enterprise Value = PV of FCFs ($49.8B) + PV of TV ($97.8B) = $147.6B. Subtracting net debt gives equity value of $137.6B, divided by shares outstanding = $231 per share.
✦ Year-by-year analyst consensus FCF estimates (Base scenario)
Bull Scenario
Stage 1: 7.0% | Stage 2: 5.0% | Terminal: 3.5%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 ✦ | Stage 1 | $6.20B | $5.77B | $5.77B |
| Year 2 ✦ | Stage 1 | $6.95B | $6.01B | $11.78B |
| Year 3 ✦ | Stage 1 | $7.75B | $6.24B | $18.02B |
| Year 4 ✦ | Stage 1 | $8.65B | $6.48B | $24.50B |
| Year 5 ✦ | Stage 1 | $9.60B | $6.69B | $31.18B |
| Year 6 | Stage 2 | $10.08B | $6.53B | $37.72B |
| Year 7 | Stage 2 | $10.58B | $6.38B | $44.10B |
| Year 8 | Stage 2 | $11.11B | $6.23B | $50.33B |
| Year 9 | Stage 2 | $11.67B | $6.09B | $56.41B |
| Year 10 | Stage 2 | $12.25B | $5.94B | $62.36B |
| Terminal | — | TV=$317.0B | PV(TV)=$153.8B (71% of EV) | EV=$216.2B |
| Intrinsic Value | — | — | EV $216.2B − Net Debt → Equity / Shares | $346 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (7.50%) to get its present value. After Year 10, FCF grows at the terminal rate (3.5%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $317.0B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $153.8B). Enterprise Value = PV of FCFs ($62.4B) + PV of TV ($153.8B) = $216.2B. Subtracting net debt gives equity value of $206.2B, divided by shares outstanding = $346 per share.
🔲 Sensitivity Table
| WACC \ gT | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 5.5% | $261 | $289 | $328 | $381 | $462 |
| 6.0% | $229 | $251 | $278 | $315 | $366 |
| 6.5% | $204 | $220 | $241 | $267 | $302 |
| 7.0% | $183 | $196 | $212 | $232 | $257 |
| 7.5% | $166 | $177 | $189 | $204 | $223 |
| 8.0% | $152 | $160 | $170 | $182 | $196 |
| 8.5% | $139 | $146 | $154 | $164 | $175 |
| 9.0% | $129 | $134 | $141 | $149 | $158 |
| 9.5% | $119 | $124 | $130 | $136 | $143 |
Green = >10% above current price. Red = >10% below. Gold = within ±10%.
📉 Long-Term Price Trend Channel
Log-linear trend fitted to full price history. ±1.5σ bands. Green shaded zone = bottom 25% of historical range — historically attractive entry.
🔮 Analyst Forecast Section
(a) EPS Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2022 | $11.21 | — | — | — | Actual |
| 2023 | $10.45 | — | — | — | Actual |
| 2024 | $11.09 | — | — | — | Actual |
| 2025 | $11.98 | — | — | — | Actual |
| 2026 | $12.01 | $12.60 | $13.28 | 29 | Estimate |
| 2027 | $12.64 | $13.67 | $14.65 | 29 | Estimate |
(b) Revenue Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2022 | $0.0B | — | — | — | Actual |
| 2023 | $0.0B | — | — | — | Actual |
| 2024 | $0.0B | — | — | — | Actual |
| 2025 | $0.0B | — | — | — | Actual |
| 2026 | $0.0B | $0.0B | $0.0B | 29 | Estimate |
| 2027 | $0.0B | $0.0B | $0.0B | 29 | Estimate |
(c) Individual Analyst Price Targets
| Analyst | Firm | Rating | PT | Upside |
|---|---|---|---|---|
| Baird | Baird | Buy | $311 | +26.6% |
| Bernstein | Bernstein | Buy | $293 | +19.2% |
| Citigroup | Citigroup | Strong Buy | $270 | +9.9% |
| JP Morgan | JP Morgan | Hold | $265 | +7.8% |
| Evercore ISI | Evercore ISI | Buy | $262 | +6.6% |
💡 Investment Thesis
- Fortress moat: 32,000-mile network, network density advantages, regulatory barriers
- Strong FCF: $5.5B annually (FCF margin 22.4%); FCF growth modest but durable
- Dividend policy: $5.52/share (2.25% yield), 19-year growth streak, 45.7% payout ratio (conservative)
- Macro sensitivity: railroad volume tied to GDP; macro headwinds into 2026 (0.54% revenue growth FY2025)
- Analyst consensus Buy at $263.09 (+7% upside); valuation reasonable
👔 Management Quality & Culture
CEO: Jim Vena · Tenure: Since 2023 (~3 yrs)
Net Insider Buys (12m)
+382,969 shares
Incentive Alignment
⚠️ Moderate
Compensation: Equity-based compensation present
CEO Background & Track Record
Union Pacific Executive Profiles | Union Pacific
CEO Jim Vena leads Union Pacific with more than 40 years of railroad industry experience, with a demonstrated track record of driving best-in-class operating and service results.
CEO Jim Vena leads Union Pacific with more than 40 years of railroad industry experience, with a demonstrated track record of driving best-in-class operating and service results.
Chronology of Union Pacific Presidents | Union Pacific
John C. (Jack) Kenefick, president, Union Pacific Railroad; October 1971 - January 1982; Chairman of the Railroad, 1982 - 1985; CEO, Union Pacific Railroad, 1982 - 1982
John C. (Jack) Kenefick, president, Union Pacific Railroad; October 1971 - January 1982; Chairman of the Railroad, 1982 - 1985; CEO, Union Pacific Railroad, 1982 - 1982
Union Pacific CEO & Leadership History: From Ogden to Vena
When COVID-19 disrupted supply chains in 2020, Fritz maintained essential freight service through revised operating procedures. ... Jim Vena became CEO of Union Pacific Railroad in August 2023. His 40+ years in rail operati
When COVID-19 disrupted supply chains in 2020, Fritz maintained essential freight service through revised operating procedures. ... Jim Vena became CEO of Union Pacific Railroad in August 2023. His 40+ years in rail operati
Capital Allocation & Strategy
Union Pacific's $3.4B Investment: Growth Strategy - Railway
This article examines Union Pacific Railroad’s (UP) ambitious $3.4 billion capital investment plan for 2024, a significant commitment despite a reported 9% decrease in net income in 2023.
This article examines Union Pacific Railroad’s (UP) ambitious $3.4 billion capital investment plan for 2024, a significant commitment despite a reported 9% decrease in net income in 2023.
Union Pacific 2025 Company Profile: Stock Performance & Earn
Information on stock, financials, earnings, subsidiaries, investors, and executives for Union Pacific. Use the PitchBook Platform to explore the full profile.
Information on stock, financials, earnings, subsidiaries, investors, and executives for Union Pacific. Use the PitchBook Platform to explore the full profile.
Employee Ratings
Overall Rating
1.9/5 ★★☆☆☆
CEO Approval
21%
Reviews
2,632
Culture Signal
Positive
✅ Strengths
- work-life balance
- good pay
- recommend
Employee Review Excerpts
Union Pacific Reviews (3,048): Pros & Cons of Working At Uni
How satisfied are employees working at Union Pacific?27% of Union Pacific employees would recommend working there to a friend based on Glassdoor reviews. Employees also rated Union Pacific 1.9 out of 5 for work life balance, 2.1 for
How satisfied are employees working at Union Pacific?27% of Union Pacific employees would recommend working there to a friend based on Glassdoor reviews. Employees also rated Union Pacific 1.9 out of 5 for work life balance, 2.1 for
Union Pacific "people" Reviews | Glassdoor
Extremely hierarchical - to the point of being insulting to experienced employees. Project approvals take forever because of the numerous layers of management.
Extremely hierarchical - to the point of being insulting to experienced employees. Project approvals take forever because of the numerous layers of management.
Union Pacific Reviews in San Antonio | Glassdoor
Jun 6, 2025 · Railroad conductor · Current employee · San Antonio, TX · Recommend · CEO approval · Business Outlook · Pros · Great place to work, love it · Cons · I love it, good pay for the family · Show more · Sign in to
Jun 6, 2025 · Railroad conductor · Current employee · San Antonio, TX · Recommend · CEO approval · Business Outlook · Pros · Great place to work, love it · Cons · I love it, good pay for the family · Show more · Sign in to
Sources: Finnhub insider data · Brave Search (Glassdoor, Indeed, Comparably, news) · Earnings surprise data from analyst forecasts · Qualitative signals are directional only.
⚖️ DCF Verdict: Hold — Union Pacific (UNP)
Current price: $245.74 | Analyst Avg PT: $263.09
$140
🔴 Bear
$231
📊 Base
$346
🚀 Bull
| Tier | Price | Action |
|---|---|---|
| Tier 1 — Starter | ≤$212 | Begin position |
| Tier 2 — Add | ≤$185 | Add on weakness |
| Tier 3 — Full | ≤$133 | Full allocation |
| Sell Alert | ≥$294 | Above fair value — consider trimming |
How tiers are set: Tier 1 = Base IV × 0.92 (8% discount to base case). Tier 2 = midpoint of Bear & Base IV (building on meaningful weakness). Tier 3 = Bear IV × 1.05 (just above worst-case — maximum margin of safety). Sell alert = Bull IV × 0.85 (15% discount to bull case — above fair value range).
Use DCF (FCFF @ WACC), NOT DDM — dividend policy is conservative, and the moat drives long-term value. Model FCF sensitivity to volume growth assumptions. Dividend is a bonus, not the value driver.
Bore Family Office • Analysis generated by Lurch • Not investment advice.