Ariel Rosa, an analyst from Citi, reiterated the Buy rating on United Parcel. The associated price target was lowered to $114.00.
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Ariel Rosa has given his Buy rating due to a combination of factors including UPS’s ongoing transformation efforts and its valuation. Despite the challenges UPS faces, such as tariff uncertainties and a weak guidance for the third quarter, the company is actively working on a multi-year plan to enhance its business mix and improve margins. This includes shifting focus away from lower-margin segments and addressing operational inefficiencies.
Moreover, UPS’s recent earnings report showed some positive signs, with revenue slightly beating expectations due to a better-than-anticipated performance in certain segments. While there are concerns about macroeconomic pressures and earnings sustainability, Rosa believes these risks are overstated. The company’s cost-cutting targets and strong free cash flow generation provide a solid foundation for future growth, supporting the Buy rating.
In another report released yesterday, Raymond James also maintained a Buy rating on the stock with a $125.00 price target.