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Union Pacific is on the right track in 2011

By: | at 07:00 PM | Intermodal  

Union Pacific Corp , the third-largest U.S. railroad is poised to report one of its best years in its more than 140-year history, and could enjoy a stronger 2011 as the economy picks up, according to an article in Barron’s.

With oil prices rising, making competitors such as trucks, more expensive, and demand for commodities surging, the need for Union Pacific’s services likely will rise, Barron’s said in its Jan 10 edition.

Earnings per share for 2011 expected to be about $6.50 per share, up from $5.43 per share in 2010, Barron’s said, citing Lisa Dong, a portfolio manager and analyst at Westwood Holdings Group in Dallas.

Although, the industry as a whole can raise prices in excess of inflation, Union Pacific has an advantage, Barron’s said. Within the next few years, Union Pacific is due to renegotiate long-term contracts that amounted to 12 percent of 2010 revenue, Barron’s said. (Reuters)