Union Pacific Corp. reported a boost in second-quarter profit on Thursday as coal and industrial product shipments pushed revenue higher.
The railroad operator saw healthy gains in coal shipments despite a steady slide in demand. Competitor CSX also reported more coal shipments during its second quarter, though it expects coal to continue its long-term decline as utilities switch to cheaper natural gas.
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Union Pacific's profit jumped 19 percent to $1.17 billion, or $1.45 per share. Revenue rose 11 percent to $5.25 billion. The results beat Wall Street expectations. The average estimate of 11 analysts surveyed by Zacks Investment Research was for earnings of $1.37 per share, while eight analysts expected $5.16 billion in revenue.
Revenue from industrial products rose 24 percent to $1.03 billion during the quarter, making up the bulk of the overall results. Coal shipment revenue rose 25 percent to $619 million and agricultural product revenue rose 7 percent to $907 million.
Looking ahead, the Omaha, Nebraska-based company said business volumes will likely be stronger in the second half of the year, though comparisons could be challenging.
"In this environment, we will focus on growth opportunities," said President and CEO Lance Fritz.
Union Pacific shares have climbed 4 percent since the beginning of the year, while the Standard & Poor's 500 index has increased 10 percent. The stock has risen 15 percent in the last 12 months.
Elements of this story were generated by Automated Insights using data from Zacks Investment Research. Access a Zacks stock report on UNP at https://www.zacks.com/ap/UNP
Keywords: Union Pacific, Earnings Report, Priority Earnings