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Union Pacific (UNP) Cheers Investors With 10% Dividend Hike

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In a shareholder-friendly move, Union Pacific Corporation (UNP - Free Report) announced a 10% hike in its dividend payout. The move underscores the company’s sound financial health as it utilizes free cash flow for enhancing shareholders’ returns.

Union Pacific raised its quarterly cash dividend to $1.30 per share ($5.20 annually) from $1.18. The new dividend will be paid to shareholders on Jun 30, 2022, of record as on May 31, 2022. The dividend yield, based on the new payout and its May 12 closing price, is 2.3%.

Union Pacific’s measures to reward its shareholders through dividends and share buybacks are encouraging. In the first quarter of 2022, UNP returned $3.5 billion to its shareholders through dividends and share repurchases. The amount was inclusive of the $2.2-billion accelerated share repurchase program executed in February.  In 2021, the company returned $10.1 billion to its shareholders through dividends ($2.8 billion) and buybacks ($7.3 billion). The company hiked dividend twice in 2021. Management anticipates share repurchases in 2022 to be in line with the 2021 levels. Additionally, the company expects dividend payout of approximately 45% (of earnings) in 2022.

Zacks Rank & Key Picks

Union Pacific carries a Zacks Rank #3 (Hold). Some better-ranked stocks within the broader Transportation sector are as follows:

C.H. Robinson Worldwide (CHRW - Free Report) sports a Zacks Rank #1 (Strong Buy). The company has an impressive earnings surprise history, having outperformed the Zacks Consensus Estimate in three of the preceding four quarters while missing the same in one. The average beat was 17.1%. You can see the complete list of today's Zacks #1 Rank stocks here.

Shares of C.H. Robinson have gained 12.6% in the past six months.

Eagle Bulk Shipping (EGLE - Free Report) carries a Zacks Rank #2 (Buy). The company’s earnings have surpassed the Zacks Consensus Estimate in two of the trailing four quarters, while missing the same in the other two. The average earnings surprise was -2.9%.

Shares of Eagle Bulk have rallied more than 60% in the past six months.

In-Depth Zacks Research for the Tickers Above

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Union Pacific Corporation (UNP) - free report >>

C.H. Robinson Worldwide, Inc. (CHRW) - free report >>

Eagle Bulk Shipping Inc. (EGLE) - free report >>