In 2023, Union Pacific will have a new CEO, according to Bank of America

After Union Pacific's CEO, Lance Fritz, announced he would be stepping down this year, Bank of America said it was time to buy the company. 

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According to a Trade Algo analyst, the railroad operator's shares have been upgraded from neutral to buy. After being flagged by the Surface Transportation Board for poor service last year, Hoexter said the company is prioritizing an operational fix. 

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This is one of the reasons for UNP's downgrade last month, according to Hoexter. It highlights the company's service and operational underperformance over the past few years. It also follows UNP's December appearance before the Surface Transportation Board (STB) to explain its embargo and poor service, the first time since CSX in 2016 that a single rail had been summoned.

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Having reviewed Vena's track record at Union Pacific, the firm expressed optimism about his potential replacement - Fritz's predecessor. In contrast, BofA noted that there weren't many experienced replacements besides Vena. 

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According to Trade Algo research, the stock's price target has been raised to $241 from $218, indicating a 25% increase from Friday's closing price. As a result of Monday's announcement of a leadership change, shares rose 10% in premarket trading.