Railroad Shares Rally Amid Union Pacific Takeover Speculation

New York, NY — Shares of CSX and Norfolk Southern increased on Thursday following reports of a potential takeover by Union Pacific. CSX and Norfolk Southern both saw their stocks rise by about 3%, while Union Pacific’s stock fell slightly by less than 1%.

According to a report from Semafor, Union Pacific has retained Morgan Stanley to explore the acquisition of another rail carrier. The report also indicated that CEO Jim Vena has mentioned the idea of creating the first transcontinental railroad in the United States, potentially including an East Coast rail carrier like CSX or Norfolk Southern.

The report suggested that the push by the Trump administration to enhance U.S. manufacturing could make a merger between major railroads more acceptable to regulators. It noted that if a deal were to be made, Union Pacific might argue that a coast-to-coast railroad could better compete with the trucking industry, which handles over 70% of domestic freight.

A spokesperson for Union Pacific told Investopedia, “The company does not comment on rumor or speculation.” Currently, shares of Union Pacific have remained relatively unchanged since the beginning of the year, while shares for CSX and Norfolk Southern have seen gains.