United Parcel (UPS)
NYSE:UPS
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United Parcel
(NYSE:UPS)
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Rating:66Neutral
Price Target:
$124.00
▲(26.30% Upside)
Action:DowngradedDate:01/28/26
The score reflects moderate financial strength constrained by cooling revenue/margins and elevated leverage, partially offset by a strong technical uptrend. Valuation is supported by a reasonable P/E and high dividend yield, while earnings-call guidance is cautiously constructive but highlights meaningful near-term margin and volume headwinds that raise execution risk.
Positive Factors
Cash generation & shareholder returns
Sustained operating cash flow and large shareholder distributions show durable free cash generation capacity. This funding supports ongoing automation, fleet renewal, dividends and buybacks while helping service debt and finance strategic moves, providing financial flexibility through cycles.
Negative Factors
Elevated leverage
A roughly 1.5x debt-to-equity ratio limits financial flexibility and increases interest-rate and refinancing sensitivity. Elevated leverage constrains capacity for large discretionary investments or aggressive buybacks and raises risk if cash conversion weakens during prolonged volume or margin stress.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation & shareholder returns
Sustained operating cash flow and large shareholder distributions show durable free cash generation capacity. This funding supports ongoing automation, fleet renewal, dividends and buybacks while helping service debt and finance strategic moves, providing financial flexibility through cycles.
Read all positive factors
United Parcel (UPS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$83.36B
Dividend Yield6.55%
Average Volume (3M)6.75M
Price to Earnings (P/E)11.8
Beta (1Y)0.85
Revenue Growth-1.25%
EPS Growth-2.25%
CountryUS
Employees241,250
SectorIndustrials
Sector Strength72
IndustryIntegrated Freight & Logistics
Share Statistics
EPS (TTM)2.38
Shares Outstanding743,855,830
10 Day Avg. Volume8,055,220
30 Day Avg. Volume6,748,316
Financial Highlights & Ratios
PEG Ratio-5.11
Price to Book (P/B)5.19
Price to Sales (P/S)0.95
P/FCF Ratio17.67
Enterprise Value/Market Cap1.32
Enterprise Value/Revenue1.24
Enterprise Value/Gross Profit6.82
Enterprise Value/Ebitda9.14
Forecast
1Y Price Target
$113.15Price Target Upside15.25% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering21
EPS Forecast (FY)7.04
Revenue Forecast (FY)$89.38B
United Parcel Business Overview & Revenue Model
Company Description
United Parcel Service, Inc. provides letter and package delivery, transportation, logistics, and related services. It operates through two segments, U.S. Domestic Package and International Package. The U.S. Domestic Package segment offers time-def...
How the Company Makes Money
UPS generates revenue through multiple streams, primarily from its package delivery services, which include both domestic and international shipments. The company charges customers based on weight, dimensions, distance, and delivery speed. Additio...
United Parcel Key Performance Indicators (KPIs)
Any
Average Daily Packages
Indicates the volume of packages handled daily, highlighting operational scale, efficiency, and demand trends in the logistics network.
Indicates the volume of packages handled daily, highlighting operational scale, efficiency, and demand trends in the logistics network.
Data provided by:
The Fly
The FlyUnited Parcel Earnings Call Summary
Earnings Call Date:Jan 27, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 28, 2026
Earnings Call Sentiment Positive
The call conveyed a cautiously positive outlook: management reported strong revenue-quality improvements, significant one-time and structural cost savings ($3.5B in 2025 and targeted ~$3.0B more tied to the Amazon glide-down), meaningful automation and digital wins, and solid cash generation. However, the company faces material near-term headwinds — volume declines (notably Amazon-related and trade-policy impacts), temporary margin pressure in H1 2026 from the glide-down, Groundsaver transition and MD-11 lease costs, and international trade-lane mix shifts. Management emphasized a two‑half 2026 shape (first-half weakness, second-half recovery) and expects longer-term margin benefits once reconfiguration and automation ramp. Overall, the achievements and actionable cost-savings plans outweigh the near-term challenges but warrant monitoring of the execution through 2026.Positive Updates
Strong Q4 and FY2025 Financials
Q4 consolidated revenue $24.5B; Q4 operating profit $2.9B; Q4 operating margin 11.8%; Q4 diluted EPS $2.38. Full-year 2025 consolidated revenue $88.7B; operating profit $8.7B; operating margin 9.8%.
Negative Updates
Volume Declines and Mix Headwinds
Full-year 2025 ADV declined 8.6%. Q4 total U.S. average daily volume down 2.4M pieces (−10.8% Y/Y). Total air ADV down 11.9%; ground ADV down 10.6%; Groundsaver ADV down 27.7%; B2C ADV down 13.8%.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Q4 and FY2025 Financials
Q4 consolidated revenue $24.5B; Q4 operating profit $2.9B; Q4 operating margin 11.8%; Q4 diluted EPS $2.38. Full-year 2025 consolidated revenue $88.7B; operating profit $8.7B; operating margin 9.8%.
Read all positive updates
Company Guidance
UPS guided to full-year 2026 consolidated revenue of approximately $89.7 billion and a consolidated operating margin of about 9.6%, with diluted EPS expected to be roughly flat to 2025; free cash flow is targeted at ~ $6.5 billion (including an annual pension contribution of ~$1.3 billion), capital expenditures around $3.0 billion, planned dividends of ~$5.4 billion, total below‑the‑line expense of ~ $760 million (including pension income of ~$250 million) and a tax rate of ~23%; segment-level guidance includes U.S. Domestic revenue roughly flat (ADV down mid-single digits, revenue per piece up mid-single digits), full‑year domestic margin flat to 2025 with first‑half domestic margins in the mid‑single digits and a second‑half rebound (high single‑digit operating profit growth, exiting toward a healthy double‑digit margin), another 1 million pieces/day Amazon glide‑down in 2026 with targeted ~$3.0 billion savings (reduce ~25 million operational hours, up to ~30,000 operational positions, 24 buildings identified for H1 closure and automation to process ~68% of U.S. volume by year‑end), International revenue up low single digits with operating margin in the mid‑teens (near‑term pressure and ~30% profit decline expected in Q1), and Supply Chain Solutions revenue up high single digits with operating margin in the low double digits; guidance assumes ~18 Boeing 767 deliveries (15 in 2026), includes an expected incremental MD‑11 related lease cost roughly double Q4 (~$100 million in 2026, ~90% in H1), and does not assume material changes to the current tariff landscape.United Parcel Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
58
Neutral
Cash Flow
61
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 88.64B | 90.89B | 90.75B | 100.03B | 97.20B |
| Gross Profit | 16.42B | 17.06B | 17.71B | 20.08B | 17.43B |
| EBITDA | 12.22B | 11.91B | 12.71B | 18.71B | 20.23B |
| Net Income | 5.57B | 5.78B | 6.71B | 11.55B | 12.89B |
Balance Sheet | |||||
| Total Assets | 73.09B | 70.07B | 70.86B | 71.12B | 69.41B |
| Cash, Cash Equivalents and Short-Term Investments | 5.89B | 6.32B | 6.04B | 7.59B | 10.59B |
| Total Debt | 32.29B | 25.65B | 26.73B | 23.52B | 25.53B |
| Total Liabilities | 56.84B | 53.33B | 53.54B | 51.32B | 55.14B |
| Stockholders Equity | 16.23B | 16.72B | 17.31B | 19.79B | 14.25B |
Cash Flow | |||||
| Free Cash Flow | 4.76B | 6.21B | 5.08B | 9.34B | 10.81B |
| Operating Cash Flow | 8.45B | 10.12B | 10.24B | 14.10B | 15.01B |
| Investing Cash Flow | -4.74B | -217.00M | -7.13B | -7.47B | -3.82B |
| Financing Cash Flow | -4.14B | -6.85B | -5.53B | -11.19B | -6.82B |
United Parcel Technical Analysis
Neutral
98.18
Price Trends
106.61
Negative
102.28
Negative
94.83
Positive
Market Momentum
-2.76
Negative
41.59
Neutral
73.10
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UPS, the sentiment is Neutral. The current price of 98.18 is above the 20-day moving average (MA) of 97.99, below the 50-day MA of 106.61, and above the 200-day MA of 94.83, indicating a neutral trend. The MACD of -2.76 indicates Negative momentum. The RSI at 41.59 is Neutral, neither overbought nor oversold. The STOCH value of 73.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for UPS.
United Parcel Risk Analysis
United Parcel disclosed 22 risk factors in its most recent earnings report. United Parcel reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
United Parcel Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $18.25B | 11.18 | 14.02% | 2.98% | 12.89% | 3.12% | |
68 Neutral | $86.29B | 22.26 | 15.76% | 1.94% | 3.09% | 14.94% | |
66 Neutral | $83.36B | 11.75 | 35.12% | 6.55% | -1.25% | -2.25% | |
66 Neutral | $19.47B | 24.87 | 35.57% | 1.02% | 12.54% | 19.59% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
63 Neutral | $23.49B | 50.75 | 17.81% | ― | -0.30% | -11.02% | |
61 Neutral | $19.91B | 32.93 | 32.52% | 1.51% | -7.08% | 71.39% |
* Industrials Sector Average
UPS
United Parcel
98.18
8.73
9.76%
CHRW
CH Robinson
167.84
80.33
91.80%
EXPD
Expeditors International
145.81
41.42
39.68%
XPO
XPO
200.52
108.47
117.84%
FDX
FedEx
361.63
160.86
80.12%
ZTO
ZTO Express
24.95
7.54
43.28%
United Parcel Corporate Events
Executive/Board Changes
United Parcel Director Warsh May Resign for Fed Role
Neutral
Feb 6, 2026
On January 30, 2026, President Donald J. Trump announced his intent to nominate Kevin M. Warsh, a member of the Board of Directors of United Parcel Service, Inc., to serve as Chairman of the Board of Governors of the United States Federal Reserve ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.