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In what may be the largest M&A deal of 2025 so far, Union Pacific ($UNP) has made a formal bid to merge with Norfolk Southern ($NSC). The proposed merger not only furthers the consolidation of the quasi-monopolistic railroad industry but also raises important questions about what it means for investors. Given the time we’ve spent highlighting Union Pacific as a model of dividend growth, we believe this surprise announcement warrants an early-stage analysis. 

In this Express Mail episode, Greg covers:

[01:12] Merger Details
Union Pacific makes a surprise $20B bid for Norfolk Southern—despite their past capital discipline.

[03:54] Financial Analysis: Debt, EBIT, and Credit Ratings
How the merger affects profitability, interest coverage, and debt loads.

[10:29] Lessons from Canadian Pacific’s Kansas City Merger
A similar deal that didn’t go quite as planned—and what it might signal for UNP.

[15:36] Dividend Outlook: What Now?
We break down whether the combined railroad can still deliver 7% dividend growth.

[17:59] Final Thoughts
Is Union Pacific now a total return story, not a dividend growth story? Why we’re holding through the uncertainty. 

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