The Best Stock in Nebraska: Union Pacific

We scoured the nation to identify the best stock in every state. Union Pacific (symbol UNP) is the publicly traded company we picked in Nebraska. The company headquarters is located in Omaha.

A word of caution: Since we selected a single stock from each state (plus one from D.C), and choices in some states are sparse, a few of our picks are best suited to investors comfortable with a higher degree of risk. This is not necessarily one of our 51 favorite stocks in the entire U.S., in other words.

Union Pacific by the Numbers

• Headquarters: Omaha
• Share price: $107.39
• Market value: $86.7 billion
• Price-earnings ratio: 19

(Prices and data are as of June 22, 2017)

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Shares of Union Pacific have been ho-hum this year, returning only 5% as the company has struggled with inconsistent shipping volumes and weak pricing due to competition from truckers and other railroads. But the country’s biggest railroad is barreling full-steam into the second half of 2017. Analysts at Credit Suisse say shipping volume is picking up, and Union Pacific’s transport prices have likely bottomed.

Factoring in productivity gains and increased demand for transported goods, including coal and “fracking” sand used in oil and natural gas production, Credit Suisse sees earnings per share up 14% this year, followed by a 14% boost in 2018. Income-oriented investors should note that the company more than tripled its dividend from 2010 to 2016. The stock currently yields 2.3%. Credit Suisse analysts are bullish on the stock, believing it can appreciate 22%, to $131, over the next 12 months.