Morgan Stanley Reiterates Overweight on Union Pacific
In a research note, Morgan Stanley maintains its Overweight rating on Union Pacific Corporation (NYSE: UNP) as it believes the company's shares will rise in absolute terms over the next 60 days.
Morgan Stanley comments, “we continue to view UNP's upcoming legacy re-pricing as a major catalyst for shares. Moreover, wide disparities in Fwd P/Es and trading around recent macro volatility have created an interesting relative value opportunity, in our view. Though OW-rated UNP isn't the cheapest rail, it is significantly cheaper than peer CNI (>1 multiple pt.) and we expect the emergence of a shareholder activist at CP to drive underperformance in CNI (see Introduction of Activist a Positive for Risk/Reward 10/31/11).”
UNP closed up 1.11 percent at $102.04 per share on Friday.
