Transport Takes: What We Learned: Feedback -- UNP U/G; Ocean Rate Tailwind; JBHT Message to Shippers?

On Wednesday (9/16) we upgraded UNP to Buy from Neutral based on rising visibility to 3% to 4% volume growth, our expectation of 4 pp stronger price in intermodal and 1.5 to 2 pp stronger merchandise pricing, and 2027 EPS 5% above Consensus; we received very little pushback to the upgrade and believe optionality on the merger with NSC is attractive, while we also have conviction in our positive view on CSX. The downside 3Q guidance commentary from JBHT was a big surprise and our sense is the mix of elevated costs to sustain the base versus pre-funding of growth is not completely clear;