: Union Pacific stock falls after profit per share and revenue rise, but come up shy of forecasts

Shares of Union Pacific Corp. UNP shed 1.0% in premarket trading Tuesday, after the railroad operator reported fourth-quarter profit and revenue that came up shy of Wall Street expectations, as continued challenges in hiring, inflation and extreme winter weather were weighed against growth in carloads. Net income fell to $1.64 billion, or $2.67 a share, from $1.71 billion, or $2.66 a share, in the year-ago period, as the number of shares outstanding was reduced by 4.4%. The Fact Set consensus for earnings per share was $2.77. Revenue grew 7.8% to $6.18 billion but was below the FactSet consensus of $6.28 billion. Operating expenses jumped 14.4% to $3.77 billion, as compensation and benefits rose 9.7% to $1.17 billion, fuel soared 42.9% to $853 million and purchased services and materials increased 17.7% to $633 million. Business volume increased 1% and operating ratio deteriorated by 3.6 percentage points to 61.0%, compared with the FactSet consensus of 59.7%. For 2023, the company expects operating ratio improvement and carloads to exceed industrial production. The stock has gained 8.6% over the past three months through Monday, while the Dow Jones Transportation Average DJT has rallied 11.5% and the Dow Jones Industrial Average DJIA has advanced 6.8%.

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