Teresa Finley, a director at Union Pacific Corp (UNP), recently added 1,380 shares. The buy represents an initial stake for the director, who paid just under $260,000 for the position.
This represents the first insider buy at the railroad since early 2020. Company insiders have been occasional sellers of shares over the past three years, with directors more likely to be buyers following a dip in price.
Overall, insiders own 0.3 percent of shares.
The railroad has dropped about 19 percent in the past year, slightly more than the S&P 500. However, earnings and revenues are both up by low double-digits in the last year, and the railroad sports a hefty 29 percent profit margin thanks to its regional monopoly.
Action to take: Shares are going for about 16 times forward earnings, on the low end of the company’s valuation over the past two years. The recently-raised dividend also gives investors a starting yield of 2.7 percent right now. That makes shares worth accumulating here, and on any down day in the months ahead.
For traders, shares have generally been dropping, with a few counter-rallies over the past few years. The short-term may be one such rally. The December $210 calls, last going for about $3.30, offer mid-double-digit returns if shares trend higher in the coming weeks.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.