Union Pacific Corp. (NYSE:UNP)

Debt to Equity

The debt to equity ratio exhibited an upward trend from 1.64 in March 2021 to a peak near 2.85 in late 2022, indicating increased leverage during this period. From early 2023 onward, the ratio steadily decreased, reaching approximately 1.84 by the third quarter of 2025, suggesting a gradual reduction in reliance on debt relative to equity.

Debt to Equity (Including Operating Lease Liability)

This metric showed a similar pattern to the standard debt to equity ratio but with slightly higher values, peaking around 2.96 in late 2022 before declining to about 1.88 by late 2025. This highlights the impact of lease liabilities on overall financial leverage, which followed the general trend of increasing then decreasing leverage.

Debt to Capital

The debt to capital ratio increased from 0.62 in early 2021 to roughly 0.74 by the end of 2022, indicating a growing proportion of debt in the company’s capital structure. Following this peak, the ratio gradually declined to approximately 0.65 by late 2025, reflecting a moderated level of debt financing relative to total capital.

Debt to Capital (Including Operating Lease Liability)

This ratio mirrored the trends of the standard debt to capital ratio but was consistently slightly higher due to inclusion of lease liabilities. The peak was around 0.75 in late 2022, declining to near 0.65 by late 2025, evidencing a reduction in overall borrowings inclusive of leases over time.

Debt to Assets

The debt to assets ratio rose from 0.43 in early 2021 to about 0.51 during 2022, indicating increasing debt relative to total assets. After peaking, it stabilized and then slightly decreased to roughly 0.46 by the third quarter of 2025, signaling a modest decline in debt burden relative to total asset base toward the end of the period.

Debt to Assets (Including Operating Lease Liability)

Including lease liabilities, the debt to assets ratio followed a parallel upward then downward trend, peaking near 0.53 in late 2022 and ending around 0.47 by late 2025. This suggests a consistent impact of operating leases on the asset-based leverage measures.

Financial Leverage

Financial leverage increased significantly from 3.8 in early 2021 to a high of approximately 5.56 at the end of 2022, indicating elevated use of debt financing during this interval. From 2023 onward, financial leverage steadily decreased to about 3.97 by late 2025, reflecting a deleveraging process or an increase in equity base relative to debt.

Interest Coverage

Interest coverage ratios improved from 6.91 in early 2021 to a peak around 8.53 in the first quarter of 2022, indicating stronger earnings ability to cover interest expenses. Although fluctuating slightly, the ratio remained relatively stable afterward, maintaining levels close to 7.9 by late 2025. This implies consistent earnings strength relative to interest obligations throughout the period.

Total Debt

The total debt showed a general increasing trend from March 2021 through March 2023, rising from approximately $26.7 billion to around $33.8 billion. After this peak, there is a gradual decline observed from December 2023 through September 2025, moving downward to about $31.8 billion. This pattern indicates initial debt accumulation followed by efforts to reduce or stabilize the debt level in the later periods.

Common Shareholders’ Equity

Common shareholders’ equity fluctuated with a declining trend from March 2021, starting at about $16.3 billion, reaching a low around $11.7 billion in September 2022. From this low point, equity demonstrated a steady recovery and growth, increasing consistently through to September 2025, with the figure reaching approximately $17.3 billion. This recovery phase suggests improvements in retained earnings or capital injections enhancing shareholders’ equity over time.

Debt to Equity Ratio

The debt to equity ratio presented a rising trend from a low of 1.64 in March 2021 to a peak of 2.85 in September 2022, coinciding with the period of increasing debt and declining equity. Subsequently, the ratio decreased consistently to a level of about 1.84 by September 2025, reflecting a deleveraging trend where the company is reducing its relative debt burden or increasing equity. The decline in this ratio over the latter periods indicates an improving balance sheet leverage position.

Overall Analysis

The data suggests a period of increasing leverage and debt accumulation through 2022, coupled with declining shareholder equity, possibly indicative of capital pressures or strategic investment activities funded by debt. Following this phase, there is a clear shift towards deleveraging and equity growth beginning around late 2022 and continuing into 2025. Such movement implies strategic financial management focusing on balance sheet strengthening and risk reduction. The improvements in equity and the falling debt to equity ratio suggest enhanced financial stability and potentially improved creditworthiness in the more recent quarters.

The analysis of the quarterly financial data reveals several noteworthy trends concerning the company's debt levels, equity base, and leverage ratios over the periods presented.

Total Debt (including operating lease liability)

The total debt showed an increasing trend from early 2021 through to the first quarter of 2022, rising from approximately 27.9 billion USD to around 33.5 billion USD. After this peak, the debt level remained relatively stable with slight fluctuations, generally ranging within 32 to 35 billion USD through early 2025. There is a modest downward trend observable towards the end of the period, with debt slightly declining to approximately 32.6 billion USD by the third quarter of 2025.

Common Shareholders’ Equity

Common equity displayed a declining trend from March 2021 through March 2022, dropping from approximately 16.3 billion USD to about 11.9 billion USD. Following this low point, equity values recovered steadily, increasing consistently quarter over quarter. This growth continued through to early 2025, reaching a peak of approximately 17.3 billion USD by the third quarter of 2025. The steady increase in equity indicates strengthening shareholder value and capital base over the latter parts of the series.

Debt to Equity Ratio (including operating lease liability)

The leverage ratio exhibits a corresponding pattern to the debt and equity movements. It rose significantly from 1.71 in March 2021 to a peak of about 2.96 in September 2022, reflecting the increase in debt coupled with a decrease in equity. After peaking, the ratio shows a clear downward trend, falling steadily to around 1.88 by the third quarter of 2025. This decline suggests an improving financial structure, characterized by decreasing leverage as equity growth outpaces or stabilizes debt levels.

Overall, the data indicate a period of financial tightening through the first part of the timeline marked by rising debt and falling equity, which increased leverage ratios. This phase was succeeded by a recovery and strengthening period where equity grew substantially, total debt stabilized or slightly declined, and leverage ratios improved, signaling enhanced financial stability and potentially lower risk in the later periods.

The financial data reveals notable trends in the company’s leverage and capital structure from the first quarter of 2021 through the third quarter of 2025. There is a consistent presence of debt on the balance sheet, with fluctuations that influence the overall debt-to-capital ratio.

Total Debt

Total debt shows an overall increasing trend from approximately $26.7 billion at the beginning of 2021, peaking near $33.8 billion in early 2023. Following this peak, total debt gradually declines, reaching about $31.8 billion by the third quarter of 2025. This pattern suggests a period of increased borrowing reaching a maximum in 2023, followed by a measured reduction in indebtedness.

Total Capital

Total capital, representing the sum of debt and equity, steadily increases throughout the observed period. Starting at around $42.9 billion in March 2021, it grows with minor fluctuations to nearly $49.1 billion by the third quarter of 2025. This indicates growth in the overall financial base of the company, reflecting either equity growth, reinvested earnings, or a combination thereof, alongside changes in debt.

Debt to Capital Ratio

The debt-to-capital ratio follows a distinct trajectory. Initially, it rises from 0.62 in March 2021 to a peak of approximately 0.74 in the third quarter of 2022, indicating an increasing reliance on debt relative to total capital. Post-peak, the ratio declines moderately to about 0.65 by the third quarter of 2025. This decline suggests an improved capital structure with reduced leverage, implying a shift towards a more balanced or equity-favoring financing approach in later periods.

Summarizing these findings, the company experienced a phase of rising leverage and debt accumulation through 2021 and 2022, which may have supported expansion or investment activities. Subsequent years reflect a strategic reduction in leverage, accompanied by steady growth in total capital, pointing to a strengthening balance sheet and potential risk mitigation in terms of financing strategy.

The analysis of the financial ratios and figures over the observed periods reveals significant trends in the company's capital structure and debt management.

Total Debt (Including Operating Lease Liability)

The total debt demonstrates an overall fluctuating yet slightly declining trend over the examined quarters. Initially, total debt increased from 27,853 million USD to a peak near 35,017 million USD around the first quarter of 2023. Subsequent quarters show a gradual reduction in debt, reaching approximately 32,571 million USD by the last reported quarter in 2025. This suggests active debt management aiming to reduce liabilities over time, despite intermittent increases throughout the timeline.

Total Capital (Including Operating Lease Liability)

Total capital shows a steady upward trajectory across the quarters. Starting from about 44,107 million USD, it increased consistently, peaking around the 49,902 million USD mark by mid-2025 before slightly stabilizing near 49,875 million USD at the end of the period. This growth indicates the company's increased asset base or equity financing, contributing positively to the capital structure.

Debt to Capital Ratio (Including Operating Lease Liability)

The debt to capital ratio experienced an initial rise from 0.63 to a high of 0.75 around late 2022, indicating a growing proportion of debt relative to capital during this period. However, from 2023 onwards, this ratio declines steadily, moving from about 0.74 to 0.65 by the end of 2025. This represents a strategic de-leveraging effort, enhancing financial stability by reducing reliance on debt in favor of equity or other capital forms.

In summary, the company exhibits a strategic pattern of debt reduction while simultaneously increasing total capital. The decreasing debt to capital ratio in recent years signals a move toward a more conservative and potentially less risky capital structure, improving long-term solvency and financial flexibility.

Total Debt

The total debt exhibited an upward trend from March 31, 2021, reaching a peak around September 30, 2022. Subsequently, a gradual decline is observed through to December 31, 2024, with a slight increase again in mid-2025 before falling toward the end of the period examined. Overall, the debt level demonstrates moderate fluctuations but remains within a range of approximately US$26.7 billion to US$33.8 billion.

Total Assets

Total assets show a consistent and steady increase throughout the entire period. From about US$61.8 billion in early 2021, assets rise to nearly US$68.6 billion by the end of the last quarter analyzed. This steady asset growth suggests ongoing investment or accumulation of resources, with no significant interruptions or reversals.

Debt to Assets Ratio

The debt to assets ratio initially increases from 0.43 to approximately 0.51 by late 2022, indicating that debt grew slightly faster than assets during this period. After reaching this peak, the ratio exhibits a gradual decline, stabilizing around the 0.46 to 0.48 range through 2024 and 2025. This trend reflects an improvement in the company's financial leverage, with asset growth outpacing debt accumulation in the latter periods.

Overall Analysis

The company appears to have increased its leverage up until late 2022, which might have been to fund expansion or capital expenditures. However, subsequent years show a reduction in overall debt levels and an improvement in the debt-to-assets ratio, suggesting a strategic effort toward deleveraging or improving financial stability. The steady increase in total assets alongside these changes implies strengthening of the balance sheet and potentially enhanced asset quality or size. No extreme volatility is noted, indicating relatively stable financial management.

Total Debt (including operating lease liability)

The total debt shows an increasing trend from March 2021 through early 2023, rising from approximately $27.9 billion to a peak near $35 billion by the first quarter of 2023. From mid-2023 onward, a gradual decline is observed, with debt levels decreasing steadily to around $32.6 billion by the third quarter of 2025. This suggests a strategy of initial debt accumulation followed by progressive deleveraging or repayment during the latter periods.

Total Assets

Total assets have exhibited a steady and gradual increase over the reported periods. Starting at approximately $61.8 billion in March 2021, assets grew consistently to reach around $68.6 billion by late 2025. This incremental growth reflects ongoing investment or asset accumulation, contributing to a strengthening asset base without abrupt fluctuations.

Debt to Assets Ratio (Including Operating Lease Liability)

The debt to assets ratio increased from 0.45 in early 2021 to a high of approximately 0.53 during late 2022 and early 2023, indicating a growing proportion of debt relative to assets during this timeframe. Following the peak, the ratio steadily decreased to approximately 0.47 by the third quarter of 2025. This movement in the ratio corroborates the earlier observation regarding total debt: the company increased leverage initially but has been reducing it relative to its asset base in recent periods.

Overall Analysis

The financial data suggests a period of leveraged expansion through 2022 and early 2023, with rising debt levels and a higher debt to assets ratio. Concurrently, assets increased steadily, which may indicate capital investments or asset acquisitions financing through debt. Post-2023, the company appears to focus on deleveraging, as evidenced by declining total debt and a decreasing debt to assets ratio, while maintaining asset growth. This pattern may reflect a strategic shift toward strengthening the balance sheet and reducing financial risk after a phase of expansion or investment.

Total Assets

Total assets show a gradual but consistent upward trend over the entire period analyzed. Starting from approximately 61.8 billion US dollars at the beginning of 2021, the asset base expanded steadily through the years, reaching nearly 68.6 billion US dollars by the third quarter of 2025. This indicates incremental asset growth, with no significant volatility or sharp declines observed across the quarterly intervals.

Common Shareholders’ Equity

Common shareholders’ equity demonstrates more variability compared to total assets. An initial decline occurs throughout 2021 and into early 2022, with equity decreasing from around 16.3 billion US dollars in early 2021 to a low point near 11.7 billion US dollars by the third quarter of 2022. Following this trough, a recovery phase ensues, with equity rising steadily through 2023 and 2024 to surpass prior highs, peaking near 16.9 billion US dollars at the end of 2024. However, the first three quarters of 2025 show some fluctuation, first dipping slightly below 16 billion before climbing again to approximately 17.3 billion US dollars in the third quarter.

Financial Leverage Ratio

The financial leverage ratio, defined as the ratio of total assets to shareholders' equity, exhibits a generally declining trend from elevated levels in early 2022 back toward lower leverage by late 2025. Initially, leverage increased significantly from about 3.8 at the start of 2021 to a peak of over 5.5 in late 2021 and mid-2022, reflecting a higher reliance on debt or liabilities relative to equity during that period. Subsequently, the ratio decreases consistently, falling to below 4 by the end of 2024 and maintaining a level just under 4 toward the third quarter of 2025. This suggests a strengthening equity base relative to assets, implying a more conservative capital structure over the recent years.

Overall Analysis

The data reveal a scenario of steady asset growth accompanied by fluctuating equity levels that recover strongly after a mid-period dip. The pattern in financial leverage aligns with these equity movements, with leverage peaking when equity was at its lowest and declining as equity strengthened. Such trends indicate a period of financial restructuring or capital adjustment around 2021-2022, followed by improved equity positions and reduced leverage, suggestive of a strategic focus on balance sheet strengthening and risk management in recent periods.

Earnings before interest and tax (EBIT)

The EBIT values exhibit fluctuations over the reported periods, with a general range between approximately 2,000 and 2,750 million US dollars. Initially, there is an upward trend from the first quarter of 2021 through mid-2022, peaking near 2,758 million. This is followed by a decline observed towards the end of 2022, reaching around 2,297 million in mid-2023. Subsequently, EBIT values recover and stabilize with moderate increases throughout 2024 and into early 2025, maintaining levels above 2,400 million and approaching 2,650 million at certain points.

Interest expense

Interest expense shows a gradual upward trend throughout the entire timeframe, increasing from roughly 290 million US dollars in the first quarter of 2021 to a peak around 339 million in mid-2023. After this peak, the expense fluctuates but remains elevated near the 320–330 million range through early 2025. This gradual increase indicates rising interest costs over the periods under review.

Interest coverage ratio

The interest coverage ratio, which signifies the ability to cover interest expenses from EBIT, starts at a level near 6.9 in early 2021 and generally increases, peaking above 8.5 in early to mid-2022. Afterward, the ratio declines gradually to a range between 7.1 and 7.6 during late 2022 and mid-2023. From mid-2023 onward, the interest coverage ratio shows signs of recovery and stabilizes between 7.2 and nearly 8.0 by early 2025, reflecting maintained EBIT relative to rising interest expenses.