Railroad CEO's Loose Lips Threaten to Torpedo His $72 Billion Megadeal

Impact · against what's priced in

The regulatory backlash against the Union Pacific merger increases the likelihood that the deal fails, reinforcing the market's current refusal to value the acquisition. This news validates the bearish lean of the current price by attacking the primary catalyst required to achieve the stock's implied revenue growth rate.

UNP−0.40

Challenges what's priced in

The price assumes

The full value of the proposed $85 billion Norfolk Southern merger

The market is not currently paying for the merger's value, but the regulatory 'serious concerns' significantly lower the probability of it closing, further distancing the company from the 14.1% revenue CAGR the price mathematically requires.

What UNP's price assumes · Sep 1

• m and a▲5%
• regulation
• UNP
• antitrust
• railroads
• union pacific

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