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Union Pacific to Report Q4 Earnings: What's in the Offing?

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Union Pacific Corporation (UNP - Free Report) is scheduled to report fourth-quarter 2024 results on Jan. 23, before market open.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

The Zacks Consensus Estimate for fourth-quarter 2024 earnings has been revised 0.4% upward in the past 60 days and is pegged at $2.78 per share. Additionally, the consensus mark implies a 2.6% uptick from the year-ago actual. The Zacks Consensus Estimate for fourth-quarter 2024 revenues is pegged at $6.15 billion, indicating a 0.2% downside from the year-ago actual.

Zacks Investment ResearchImage Source: Zacks Investment Research

UNP has an impressive earnings surprise history. The company’s earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters and missed the mark in the remaining quarter, the average beat being 3.7%.

Union Pacific Corporation Price and EPS Surprise

Union Pacific Corporation Price and EPS Surprise

Union Pacific Corporation price-eps-surprise | Union Pacific Corporation Quote

Q4 Earnings Whispers for UNP

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 chances of an earnings beat, which is not the case here.

The company's Earnings ESP is -0.18%. UNP currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Factors to Note Ahead of UNP’s Q4 Earnings Release

We expect United Pacific's performance in the to-be-reported period to have been adversely affected by the woes of the freight market downturn and a soft consumer market.

Our estimate for freight revenues is pegged at $5.7 billion, which indicates a 1.6% decline compared with the actuals of fourth-quarter 2023. Meanwhile, estimates for other revenues are pegged at $417 million, indicating a 16.5% uptick from the fourth quarter of 2023 actuals.

UNP’s efforts to cut costs to combat revenue woes are expected to have aided bottom-line performance in the quarter to be reported. Due to cost cuts and improved operational efficiency, we expect operating expenses to have declined 1% in the fourth quarter of 2024 from the year-ago actuals. Due to reduced costs, we expect the operating ratio (operating expenses as a percentage of revenues) to have improved 30 basis points to 60.6% in the December quarter. A lower value of the metric is preferable.

Highlights of UNP’s Q3 Earnings

Union Pacific's third-quarter 2024 earnings of $2.75 per share missed the Zacks Consensus Estimate of $2.76. However, the bottom line improved 9.6% on a year-over-year basis. The year-over-year improvement was due to strong operational efficiency and favorable pricing.

Operating revenues of $6.09 billion lagged the Zacks Consensus Estimate of $6.19 billion. However, the top line improved 2.5% on a year-over-year basis due to core pricing gains and higher volumes.

Stocks to Consider

Here are a few stocks from the broader Zacks Transportation sector that investors might want to consider as our model shows that these have the right combination of elements to beat fourth-quarter 2024 earnings.

American Airlines (AAL - Free Report) has an Earnings ESP of +3.99% and sports a Zacks Rank #1 at present. AAL is set to release fourth-quarter 2024 results on Jan. 23, 2025. 

Passenger volumes are likely to have been high, aiding the performance. Low fuel costs are expected to have aided the bottom-line performance. However, labor costs are likely to have been high. AAL has an encouraging earnings surprise history, having surpassed the Zacks Consensus Estimate thrice in the preceding four quarters and missing once. The average miss is 124.4%.

JetBlue Airways (JBLU - Free Report) has an Earnings ESP of +7.73% and a Zacks Rank #3 at present. JBLU is slated to release fourth-quarter 2024 results on Jan. 28, 2025.

JBLU is set for an impressive fourth-quarter performance, backed by strong passenger revenues and low fuel costs. High labor costs are likely to have dented bottom-line performance. JBLU has an encouraging earnings surprise history, having surpassed the Zacks Consensus Estimate in each of the preceding four quarters. The average beat is 62.8%. 


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