We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
UNP has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in three of the preceding four quarters (missed once), the average beat being 2.28%.
The Zacks Consensus Estimate for second-quarter 2023 earnings has declined 4.5% over the past 90 days.
Given this backdrop, let’s check out the factors that might have influenced Union Pacific’s performance in the quarter under review.
We expect Union Pacific’s performance to have been hurt by soft revenues due to weak freight demand. The Zacks Consensus Estimate for quarterly revenues is currently pegged at $6.13 billion, reflecting a 2.2% decline from second-quarter 2022 actuals.
Freight revenues account for bulk of the top line. Our estimate for freight revenues indicates a 2.1% decline from second-quarter 2022 levels. Our projection for other revenues suggests a 3.3% decline from the figure reported in second-quarter 2022.
On the flip side, lower expenses, mainly due to a decline in fuel costs, are likely to have aided the bottom-line performance. Our estimate for operating expenses (adjusted) indicates a 2.2% decrease from second-quarter 2022 actuals. We expect fuel costs to be down 9.5% from the prior-year qurter’s levels.
Owing to lower costs, operating ratio (operating expenses as a percentage of revenues) is likely to have improved sequentially. Our second-quarter 2023 estimate for this key metric is currently pegged at 60.2% compared with 62.1% reported in first-quarter 2023. A lower value of this metric is preferable.
The uptick in overall volumes as labor woes ease is an added positive. Our estimate for second-quarter 2023 volumes currently implies a 1.6% increase from year-ago quarter’s reported figure.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for UNP this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Union Pacific currently has an Earnings ESP of -1.16% (the Most Accurate Estimate is currently pegged at $2.72 per share, which is 3 cents below the Zacks Consensus Estimate) and a Zacks Rank #3.
Highlights of Q1
Union Pacific's first-quarter 2023 earnings of $2.67 per share handily surpassed the Zacks Consensus Estimate of $2.57. Moreover, the bottom line improved 3.9% on a year-over-year basis. Operating revenues of $6,056 million missed the Zacks Consensus Estimate of $6,072.6 million.
Stocks to Consider
Here are a few stocks from the broader Zacks Transportation sector that investors may consider, as our model shows that these have the right combination of elements to beat on their second-quarter 2023 earnings.
American Airlines (AAL - Free Report) has an Earnings ESP of +1.94% and a Zacks Rank #3. AAL will release results on Jul 20.
AAL delivered a trailing four-quarter earnings surprise of 12.9%, on average. The Zacks Consensus Estimate for AAL’s second-quarter 2023 earnings suggests a surge of more than 100% from the year-ago reported figure.
JBLU has an expected earnings growth rate of 192.5% for the current year. The company has surpassed the Zacks Consensus Estimate in two of the past four quarters, missing twice. The average miss is 78.36%.
Image: Bigstock
Union Pacific (UNP) Gears Up for Q2 Earnings: What's in Store?
Union Pacific Corporation (UNP - Free Report) is scheduled to report second-quarter 2023 results on Jul 26, before market open.
UNP has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in three of the preceding four quarters (missed once), the average beat being 2.28%.
Union Pacific Corporation Price and EPS Surprise
Union Pacific Corporation price-eps-surprise | Union Pacific Corporation Quote
The Zacks Consensus Estimate for second-quarter 2023 earnings has declined 4.5% over the past 90 days.
Given this backdrop, let’s check out the factors that might have influenced Union Pacific’s performance in the quarter under review.
We expect Union Pacific’s performance to have been hurt by soft revenues due to weak freight demand. The Zacks Consensus Estimate for quarterly revenues is currently pegged at $6.13 billion, reflecting a 2.2% decline from second-quarter 2022 actuals.
Freight revenues account for bulk of the top line. Our estimate for freight revenues indicates a 2.1% decline from second-quarter 2022 levels. Our projection for other revenues suggests a 3.3% decline from the figure reported in second-quarter 2022.
On the flip side, lower expenses, mainly due to a decline in fuel costs, are likely to have aided the bottom-line performance. Our estimate for operating expenses (adjusted) indicates a 2.2% decrease from second-quarter 2022 actuals. We expect fuel costs to be down 9.5% from the prior-year qurter’s levels.
Owing to lower costs, operating ratio (operating expenses as a percentage of revenues) is likely to have improved sequentially. Our second-quarter 2023 estimate for this key metric is currently pegged at 60.2% compared with 62.1% reported in first-quarter 2023. A lower value of this metric is preferable.
The uptick in overall volumes as labor woes ease is an added positive. Our estimate for second-quarter 2023 volumes currently implies a 1.6% increase from year-ago quarter’s reported figure.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for UNP this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Union Pacific currently has an Earnings ESP of -1.16% (the Most Accurate Estimate is currently pegged at $2.72 per share, which is 3 cents below the Zacks Consensus Estimate) and a Zacks Rank #3.
Highlights of Q1
Union Pacific's first-quarter 2023 earnings of $2.67 per share handily surpassed the Zacks Consensus Estimate of $2.57. Moreover, the bottom line improved 3.9% on a year-over-year basis. Operating revenues of $6,056 million missed the Zacks Consensus Estimate of $6,072.6 million.
Stocks to Consider
Here are a few stocks from the broader Zacks Transportation sector that investors may consider, as our model shows that these have the right combination of elements to beat on their second-quarter 2023 earnings.
American Airlines (AAL - Free Report) has an Earnings ESP of +1.94% and a Zacks Rank #3. AAL will release results on Jul 20.
AAL delivered a trailing four-quarter earnings surprise of 12.9%, on average. The Zacks Consensus Estimate for AAL’s second-quarter 2023 earnings suggests a surge of more than 100% from the year-ago reported figure.
JetBlue Airways (JBLU - Free Report) has an Earnings ESP of +12.50% and a Zacks Rank #2. JBLU will release results on Aug 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
JBLU has an expected earnings growth rate of 192.5% for the current year. The company has surpassed the Zacks Consensus Estimate in two of the past four quarters, missing twice. The average miss is 78.36%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.