Mattern Capital Abandons $9.1M Union Pacific Stake Amid Merger Drama 🚂

On Oct. 21, 2025, Mattern Capital Management disclosed in a U.S. Securities and Exchange Commission (SEC) filing that it sold its entire Union Pacific Corporation stake, an estimated $9.1 million trade. One might wonder if this was a calculated move or simply a case of the universe gently nudging investors toward the exit signs of yet another corporate tango.

What happened

According to an SEC filing dated Oct. 21, 2025, Mattern Capital exited its entire holding in Union Pacific Corp. (UNP +0.00%), selling all 39,549 shares. The estimated trade size was $9.1 million. The stake previously represented 1.1% of the fund’s assets under management as of the prior filing period ended Sept. 30, 2025. It’s worth noting that Union Pacific’s 2.4% dividend yield, while respectable, may have seemed less appealing next to the gravitational pull of Microsoft’s cash reserves or Apple’s increasingly surreal stock price. (One wonders what kind of dividend checks would arrive from a company that sells “intermodal freight” and calls it a day.)

What else to know

The fund fully sold out of Union Pacific. Its new portfolio reads like a list of companies that have mastered the art of not being Union Pacific: Apple, Microsoft, Walmart, Cencora, and Lowe’s. These names now dominate the fund’s top holdings, each presumably offering a more stable dividend stream than a railroad trying to merge with another railroad in a bid to become the FedEx of freight. (Imagine two trains on a collision course, each carrying a different brand of coffee-only to realize they’re both just trying to deliver beans to the same customer. Absurd? Only in the context of Earth’s economy.)

Apple: $20.1 million (2.4% of AUM) as of Sept. 30, 2025
Microsoft: $19.3 million (2.3% of AUM).
Walmart: $14.6 million (1.7% of AUM).
Cencora: $13.8 million (1.6% of AUM).
Lowe’s: $13.3 million (1.6% of AUM).

As of Oct. 20, 2025, shares of Union Pacific Corporation were priced at $227.30, reflecting a one-year change of (-5.43%) and an alpha of (-19.03) percentage points versus the S&P 500 (both measured over the prior 252 trading days). This is the kind of performance that makes one question whether the railroad tracks have been subtly rerouted to include loops and corkscrews. (A 19-point alpha deficit is like arriving at your destination only to find the building has been replaced by a giant, inexplicable sculpture of a duck wearing a top hat.)

Company Overview

Metric	Value
Revenue (TTM)	$24.4 billion
Net Income (TTM)	$6.93 billion
Dividend Yield	2.4%
Price (as of market close 2025-10-20)	$227.30

Company Snapshot

Union Pacific provides rail transportation services for agricultural products, industrial goods, energy, construction materials, chemicals, and intermodal freight across its rail network in the United States. In other words, it’s the equivalent of a delivery service that refuses to use any mode of transport faster than a horse-drawn cart… but with more mergers. (If this were a sci-fi novel, the railroad would be the antagonist who insists on solving every problem by building a bigger bridge, no matter how many rivers get in the way.)

The company generates revenue primarily through long-haul freight movement, leveraging an extensive rail infrastructure to connect major ports and inland markets efficiently. Efficiency, in this context, might mean that your shipment of wheat arrives in 17 days, but at least it’s in a container that doubles as a time capsule. (One imagines the CEO of Union Pacific reading a report titled “Optimizing Freight Flow” and nodding solemnly, unaware it’s actually a blueprint for a perpetual motion machine.)

Foolish take

Union Pacific and fellow railroad Norfolk Southern announced a planned merger in July, 2025. Both companies’ boards of directors have unanimously approved the $85 billion deal. The potential merger is still in the initial approval stages, with formal review that could take until late next year. This is the kind of corporate strategy that makes one wonder if the executives are playing chess on a board where the pieces are all named “Mergers” and the rules are written in hieroglyphics. (The $85 billion price tag is so large it could buy a small country… assuming that country’s primary export is patience.)

Mattern’s exit of its Union Pacific position may signal that it doesn’t back the deal, or doesn’t think it will receive final approval. The market seems to be hesitant as well. Union Pacific would value Norfolk Southern at $320 per share, yet Norfolk shares still only traded at $290 per share at recent levels. This discrepancy is so vast it could fit an entire SEC filing inside. (If the merger were a train, it would be the one that departs the station only to circle the block for 18 months before asking if anyone actually needs to go anywhere.)

Union Pacific wasn’t in the top five, or even 10, equity holdings for Mattern Capital. The firm may have decided to avoid the risk associated with the merger. Union Pacific shares haven’t changed much since the deal was announced, and Mattern looks to have decided to simply move on from the railroad name. In the grand cosmic lottery of dividend investing, sometimes the safest bet is to exit the game before the dice are rolled. (After all, what’s the point of a 2.4% yield if the company’s future looks like a spreadsheet error?)

Glossary

Assets Under Management (AUM): The total market value of investments managed on behalf of clients by a fund or firm. (Think of it as the universe’s way of saying, “Here’s a number so large it could fill a black hole… but let’s pretend it’s just a Tuesday.”)
Alpha: A measure of an investment’s performance relative to a benchmark index, showing excess return or underperformance. (Imagine measuring how far you’ve walked compared to a snail that’s hitching a ride on a rocket ship. The snail wins, obviously.)
Stake: The ownership interest or position held in a company or asset by an investor or fund. (A stake is to investing what a life raft is to a sinking ship-only slightly less likely to keep you afloat.)
Position: The amount of a particular security or asset held in a portfolio. (Holding a position is like holding a lottery ticket, except the odds are set by a committee of economists who all wear the same tie.)
Quarterly Average Price: The average trading price of a security over a specific quarter, used for estimating transaction values. (This is the financial equivalent of asking a blindfolded person to guess the color of the sky and then betting on it.)
Intermodal Freight: Goods transported using multiple modes of transportation (like rail and truck) without handling the actual cargo when changing modes. (It’s the logistical equivalent of passing a message in a bottle from one ocean to another, only to realize the bottle has a leak and the message is just “Where are we?”)
Dividend Yield: A financial ratio showing how much a company pays in dividends each year relative to its share price. (A 2.4% yield is like getting a 24% discount on a sandwich that’s missing half its bread. You’re welcome.)
TTM: The 12-month period ending with the most recent quarterly report. (Think of it as the universe’s way of saying, “Let’s pretend this year exists in a coherent timeline.”)
Reportable Assets: Assets that must be disclosed in regulatory filings due to their size or significance in a portfolio. (These are the financial world’s version of a “Most Likely to Be Noticed by the IRS” award, except nobody wants to win it.)
Fund: An investment vehicle pooling money from multiple investors to buy securities according to a specific strategy. (A fund is to investing what a democracy is to decision-making-only slightly less chaotic and with more spreadsheets.)

2025-10-21 23:58