Union Pacific (UNP) Stock: $208 Target From Susquehanna

By Amit Chowdhry ● Sep 29, 2022
  • The shares of Union Pacific (UNP) recently received a $208 price target from Susquehanna. These are the details.

The shares of Union Pacific (UNP) recently received a $208 price target from Susquehanna. 

Price target: Reduced from $240 to $208

Rating: Neutral

Analyst: Susquehanna analyst Bascome Majors

Majors adjusted the rating while cutting forward rail volume estimates on macro deterioration. And Majors pointed out that the company profits will be under further pressure from investments in service and U.S. union pay hikes through 2024. 

Going forward next year, macroeconomic clouds continue to linger and the pressure to improve rail service has not eased. The U.S. rail labor costs are due for a markup considering the tentative union agreements and the risk of a work stoppage could surface again in late November and early December. Plus while U.S. rail stocks have underperformed recently, it is hard to call rail shares de-risked as they are capitalizing on consensus earnings growth next year at forward multiples moderately below long-term levels. So Majors is now erring on the side of cyclical caution for rails.