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Union Pacific Affirms Full-Year Earnings Guidance Following First-Quarter EPS Beat

-- Union Pacific (UNP) affirmed its full-year earnings outlook, while its first-quarter bottom-line topped Wall Street's estimates, sending the railroad operator's shares higher Thursday.

The company said it continues to expect per-share earnings growth of mid-single digit this year.

"Beyond 2026, we remain committed to attaining our three-year (compound annual growth rate) target of high-single-digit to low-double-digit EPS growth throughout 2027," Chief Financial Officer Jennifer Hamann said on an earnings conference call Thursday, according to a FactSet transcript.

Union Pacific expects full-year coal results to be "positive," despite current natural gas pricing, Kenyatta Rocker, executive vice president of marketing and sales, said on the call. Improving export demand to China, along with sustained momentum into Mexico, places the company's grain business "well" to support growth, Rocker added.

First-quarter EPS rose to $2.87 from $2.70 a year earlier, exceeding the FactSet-polled consensus of $2.84. Operating revenue increased 3% to $6.22 billion, just shy of the Street's $6.23 billion views.

The company's stock was up 7.1% in Thursday late-afternoon trade, extending its year-to-date gains to 16%.

First-quarter freight revenue for the bulk segment advanced 10% year over year to $2.03 billion, led by a 17% jump in coal and renewables. Industrial revenue increased 5% to $2.19 billion.

"Our first-quarter business mix was positive, although not as favorable as we might have expected, due to the higher volume in our lower average revenue per car businesses, such as coal and rock, combined with lower volume on some of the higher (average revenue per car) businesses, such as food and refrigerated and forest products," Hamann told analysts.

Revenue for the premium segment, which covers intermodal and automotive, declined 5% to $1.68 billion for the quarter.

"As expected, lower West Coast imports and customer shifts had a drag on international intermodal volumes, which decline 28% versus last year," Rocker told analysts.

Price: $267.94, Change: $+18.54, Percent Change: +7.43%

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