Union Pacific Corp (NYSE:UNP) stock rose 0.022% (As on October 25, 11:23:11 AM UTC-4, Source: Google Finance) after the company missed the market’s expectations for the third quarter of FY 24. Freight revenues, accounting for 94.7% of the top line, increased 4% to $5.77 billion. Other revenues decreased 18% to $323 million in the third quarter of 2024. Business volumes, measured by total revenue carloads, increased by 6% year over year. The operating income was up 11% year over year at $2.4 billion. Total operating expenses of $3.68 billion declined 2% year over year. Fuel expenses plunged 13%. The operating ratio improved by 310 basis points year over year to 60.3%. Lower quarterly fuel prices positively impacted the operating ratio by 120 basis points. Further, Union Pacific exited the third quarter of 2024 with cash and cash equivalents of $947 million compared with $1.06 billion in the fourth quarter of 2023.
Moreover, Bulk freight revenues were $1.80 billion, which increased 2% on a year-over-year basis. Segmental revenue carloads declined 3% year over year. Industrial freight revenues totaled $2.12 billion, up 3% year over year. Segmental revenue carloads fell by 2% year over year. Freight revenues in the Premium division were $1.84 billion, up 7% year over year. Premium revenue carloads improved 14% year over year.
UNP in the third quarter of FY 24 has reported the adjusted earnings per share of $2.75, missing the analysts’ estimates for the adjusted earnings per share of $2.76, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 3 percent to $6.09 billion in the third quarter of FY 24, missing the analysts’ estimates for revenue of $6.19 billion. The number of shipments Union Pacific delivered in the quarter was mixed across different sectors. Intermodal shipments of cargo containers led the growth, but those generate the least revenue per car on average. Coal continued its long-term decline, but metals, minerals and auto shipments were also down.
Union Pacific now expects fourth-quarter results to be consistent sequentially from the third quarter while improving year over year versus the fourth quarter of 2023. The company continues to remain optimistic about current-year profitability, expecting it to gain momentum due to a robust service product, enhanced network efficiency and stable pricing.
In addition, the management also plans to repurchase approximately $1.5 billion in shares in 2024 and anticipates capital expenditures of $3.4 billion for the entire year.