After Union Pacific "modestly" topped expectations in Q2, Morgan Stanley analyst Ravi Shanker noted that consensus had declined 9% since May and said he thinks the small beat could come as a disappointment "for a railroad that is in the prime of its PSR implementation." Shanker, who thinks the stock is "priced for PSR perfection," said he has little doubt that the company's headcount cuts are driven by its Precision Scheduled Railroading shift, but he also believes they were accelerated by the tough environment. He keeps an Underweight rating on Union Pacific shares, though he raised his price target on the stock to $140 from $128.