Rails Back On Track: Analyst Upgrades Union Pacific And Norfolk Southern, Predicts Strong Intermodal Recovery
Portfolio Pulse from Lekha Gupta
Bernstein analyst David Vernon upgraded Union Pacific Corp (UNP) to Outperform with a $280 price target and Norfolk Southern Corp (NSC) to Outperform with a $272 price target, citing a strong intermodal recovery and a positive outlook for the rail industry in FY24. He expects a seasonal uptick in freight demand and a recovery in the Merchandise/Industrial business. Vernon also reiterated a Market-Perform rating on CSX Corp (CSX) with a raised price target of $36, due to a sluggish outlook for FY24 and volatile earnings from met coal.
January 22, 2024 | 6:09 pm
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POSITIVE IMPACT
Norfolk Southern upgraded to Outperform with a $272 price target by Bernstein analyst, based on its turnaround story and anticipated recovery in the rail industry.
The upgrade to Outperform and a significant price target increase indicate a positive outlook for NSC, which could result in a short-term uptick in its stock price as the market reacts to the analyst's expectations.
CONFIDENCE 80
IMPORTANCE 80
RELEVANCE 90
POSITIVE IMPACT
Union Pacific upgraded to Outperform with a $280 price target by Bernstein analyst, reflecting a positive outlook for the rail industry and strong intermodal recovery expected in FY24.
The upgrade to Outperform and a high price target suggest a strong bullish sentiment from the analyst, which could lead to increased investor confidence and a potential short-term price increase for UNP.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 90
NEUTRAL IMPACT
CSX Corp's rating was reiterated at Market-Perform with a price target increase to $36 by Bernstein analyst, due to a sluggish FY24 outlook and volatile met coal earnings.
While the price target was raised, the reiteration of a Market-Perform rating and concerns about volatility in met coal earnings suggest a neutral short-term impact on CSX's stock price.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 70