Union Pacific Corporation (UNP)

Activity ratios

Short-term

Turnover ratios

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Inventory turnover	12.70	13.72	14.11	13.45	11.92
Receivables turnover	12.94	11.19	12.78	12.05	12.98
Payables turnover	11.53	11.91	13.33	11.11	12.43
Working capital turnover	—	—	—	—	476.41

Based on the provided data for Union Pacific Corporation, we can assess the company's activity ratios for inventory turnover, receivables turnover, payables turnover, and working capital turnover.

1. Inventory Turnover:
- The inventory turnover ratio measures how efficiently a company manages its inventory. Union Pacific's inventory turnover has shown a positive trend from 11.92 in 2020 to 12.70 in 2024. This indicates that the company is selling its inventory more frequently each year, which is a positive sign of efficient inventory management.

2. Receivables Turnover:
- The receivables turnover ratio reflects how effectively a company collects payments on credit sales. Union Pacific's receivables turnover has fluctuated over the years, with a peak of 12.98 in 2020 and a low of 11.19 in 2023. However, the ratio has remained relatively stable and ended at 12.94 in 2024, suggesting the company is efficiently managing its receivables.

3. Payables Turnover:
- The payables turnover ratio shows how quickly a company pays its suppliers. Union Pacific's payables turnover slightly varied over the years, with the highest ratio of 13.33 in 2022 and the lowest of 11.11 in 2021. Overall, the company's payables turnover indicates that Union Pacific maintained a moderate pace in settling its payables to suppliers during the period.

4. Working Capital Turnover:
- The working capital turnover ratio reflects how effectively a company utilizes its working capital to generate sales. Unfortunately, there is missing data for Union Pacific's working capital turnover from 2021 to 2024. It is essential to have this information to assess how efficiently the company is using its working capital.

In conclusion, based on the available data, Union Pacific Corporation demonstrates sound efficiency in managing its inventory and receivables, with moderate management of payables. However, further insight would be necessary on the working capital turnover to provide a comprehensive analysis of the company's overall activity efficiency.

Average number of days

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Days of inventory on hand (DOH)	days	28.74	26.60	25.88	27.14	30.61
Days of sales outstanding (DSO)	days	28.20	32.62	28.57	30.30	28.12
Number of days of payables	days	31.65	30.65	27.38	32.87	29.37

Based on the provided data, let's analyze Union Pacific Corporation's activity ratios:

1. Days of Inventory on Hand (DOH):
- The average number of days Union Pacific holds inventory decreased from 30.61 days in 2020 to 28.74 days in 2024.
- The lower DOH suggests that Union Pacific has been managing its inventory more efficiently over this period.

2. Days of Sales Outstanding (DSO):
- The average number of days it takes Union Pacific to collect revenue increased from 28.12 days in 2020 to 28.20 days in 2024.
- The stable DSO indicates that Union Pacific has maintained effective credit management practices in collecting its sales revenue.

3. Number of Days of Payables:
- The average number of days Union Pacific takes to pay its suppliers was relatively stable, ranging from 27.38 days in 2022 to 32.87 days in 2021.
- The stable payment period to suppliers indicates a consistent approach to managing payables.

In conclusion, Union Pacific Corporation has shown improvements in inventory management efficiency and has maintained stable collection and payment practices over the years analyzed. Efficient management of these activity ratios contributes to the company's overall operational performance and financial health.

Long-term

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Fixed asset turnover	0.42	0.40	0.43	0.38	0.36
Total asset turnover	0.36	0.35	0.37	0.33	0.31

The Fixed Asset Turnover ratio for Union Pacific Corporation has shown a gradual increase over the past five years, moving from 0.36 in December 2020 to 0.42 by December 2024. This indicates that the company is generating more revenue relative to its investment in fixed assets.

Similarly, the Total Asset Turnover ratio has also exhibited an upward trend, rising from 0.31 in December 2020 to 0.36 in December 2024. This suggests that Union Pacific is effectively utilizing its total assets to generate sales.

Overall, the improvements in both Fixed Asset Turnover and Total Asset Turnover ratios demonstrate Union Pacific's efficiency in generating revenue from its assets over the years, which is a positive indicator of the company's operational performance.