Acquisition UNP

Union Pacific Corp LogoIt has been a while since I pulled a trigger and bought a stake into a quality company. I almost feel like it has been too long. I have been searching for a few weeks now and it always brings me great joy searching for new acquisition. I don’t know what it is, but I think I see the light in a dark tunnel. You see I enjoy it because new acquisition will be bringing in new dividends that I hope I can reap for a long time. I think I found the one. I¬†decided to stay within my portfolio add a larger stake in one of my current ownerships. Here is my recent trigger pull.

One fo Americas most recognized companies that links 23 states in the western two-thirds of the country by rail. Union Pacific Corporation has ownership in principal operating company of Union Pacific Railroad. It provides critical transportation role to global supply chain. It is has equally diversified business in agricultural products, automotive, chemicals, coal, industrial product and intermodal. Operates from West Coast and Gulf Coast ports to eastern gateways, connects Canada’s rail system and is the only railroad serving six major Mexico gateways. Union Pacific provides great deal of value to its roughly 10,000 costumers by delivering products in a safe, reliable, fuel-efficient and environmentally responsible manner.

I love my railroad oligopolies, and there are only a few huge companies here in U.S. that are controlling the whole sector. It is a very easy business model to understand. The company has been increasing dividend regularly and I believe we will see it to continue.

  • Dividend Yield: 1.9%
  • Dividend Growth 5yr: 26.2%
  • Payout Ratio: 31%
  • P/E: 19.8

I purchased 5 shares for the price of $185.70 adding $18.20 to my annual income.

The 12-month dividend income increased to $2,305.

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4 Comments

  1. JC @ Passive-Income-Pursuit on March 30, 2014 at 12:04

    I’ve been wanting to add some UNP to go with my NSC stake but it always seems to elude my purchase capital. Guess I’ll have to give it a further look through to see how it stands. I love the railroads for the same reason as you, essentially no competition in their areas of operation.

    • DividendVet on March 30, 2014 at 20:50

      I am in the same boat as you, except I would like to add NSC to my portfolio. I believe NCS and UNP are like KO and PEP, two great industry leaders playing for the same team. Like James and Wade =)

      Thanks for stopping by!

  2. Dan Mac @ Dividend Growth Stock Investing on April 6, 2014 at 15:39

    I’m a big fan of UNP and it is on my list for future purchase. Currently I own the other 2 big U.S. railroads (NSC and CSX). I’d like to add UNP to my collection.

    I like the company a lot and think it will do well over the long term. I probably haven’t made the purchase yet because I always seem to find something else that interests me when I have the capital available. There are almost too many great dividend growth companies to choose from!

    • DividendVet on April 6, 2014 at 18:32

      Yeah, I believe railroads are the way to go. They are much more efficient in delivering goods, rather than one by one by trucking industry. Development of electric trains will have a huge impact one day as well. But, that is the great thing about American market so many great companies to choose from.

      Good hearing from you.

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