Union Pacific stock forecast
At the first forecast date, October 2027, Union Pacific's weighted price is $179.31. Union Pacific's forecast hinges on traffic gains and savings outrunning new shares, debt and integration costs.
Where could Union Pacific's shares be by October 2029?
At the first forecast date, October 2027, the weighted price is $179.31. That is a 34% loss including dividends. At the last forecast date, October 2029, it is $255.17. That is a 3% loss including dividends. The forecast assigns 30% probability to the bear case and 50% to base. The bull case receives 20%.
| Case | Probability | October 2027 | October 2028 | October 2029 |
|---|---|---|---|---|
| Bear | 30 % | 204.94 (-25 %) | 85.00 (-66 %) | 83.62 (-65 %) |
| Base | 50 % | 161.69 (-41 %) | 254.98 (-5 %) | 297.04 (+12 %) |
| Bull | 20 % | 184.92 (-32 %) | 337.99 (+24 %) | 407.80 (+51 %) |
| Weighted | 100 % | 179.31 (-34 %) | 220.59 (-18 %) | 255.17 (-3 %) |
What has to go right or wrong for Union Pacific?
EBITDA rises gradually before the merger, then jumps when Norfolk Southern contributes. The base case uses $13,400 million in October 2027, supported by a 4% standalone growth assumption and improved velocity and dwell. It reaches $19,850 million in October 2028 and $21,400 million in October 2029 as Norfolk Southern and synergies are added. The bear case excludes Norfolk Southern until later and falls to $12,350 million in 2028, reflecting the 2023 decline and traffic risk. The bull case reaches $22,800 million by 2029 because pricing, productivity and synergies all exceed the base path. Management’s EPS outlook supports growth, but it is not EBITDA guidance.
| October 2027 | October 2028 | October 2029 | |
|---|---|---|---|
| EBITDA | 13,400 (12,700 / 13,700) | 19,850 (12,350 / 20,900) | 21,400 (12,800 / 22,800) |
| Shares (millions) | 820 (595 / 820) | 821 (821 / 821) | 821 (821 / 818) |
| Dividends per share | 5.72 (5.68 / 5.75) | 5.88 (4.82 / 6.01) | 6.05 (4.80 / 6.33) |
| Enterprise value to ebitda | 14.50 (11.50 / 15.50) | 13.50 (10.50 / 16.00) | 14.00 (10.00 / 17.00) |
| Net debt | 61,713 (24,113 / 60,713) | 58,713 (59,913 / 57,013) | 55,613 (59,313 / 53,813) |
How much cash does Union Pacific really make?
That creates a sequence: profit becomes operating cash, and operating cash becomes free cash flow only after capital spending. “Real” free cash flow goes one step further by treating stock compensation as an economic cost because it dilutes shareholders.
| 2025 | 2024 | 2023 | 2022 | 2021 | |
|---|---|---|---|---|---|
| Cash from operations | 9,290 | 9,346 | 8,379 | 9,362 | 9,032 |
| − Capital spending | 3,791 | 3,452 | 3,606 | 3,620 | 2,936 |
| = Free cash flow | 5,499 | 5,894 | 4,773 | 5,742 | 6,096 |
| − Stock pay | 142 | 118 | 107 | 99 | 88 |
| = Real free cash flow | 5,357 | 5,776 | 4,666 | 5,643 | 6,008 |
| Real free cash flow, % of revenue | 21.9% | 23.8% | 19.3% | 22.7% | 27.6% |
What does an investor pay for Union Pacific today?
This table sets out the current share price, market value, enterprise value, valuation multiples, cash-flow yields and dividend yield.