United Parcel Service (UPS)
Market Price (9/16/2026): $101.52 | Market Cap: $86.4 BilInvestor Relations Sector: Industrials | Industry: Air Freight & Logistics
United Parcel Service (UPS)
Market Price (9/16/2026): $101.52Market Cap: $86.4 BilSector: IndustrialsIndustry: Air Freight & Logistics
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
Attractive yieldTotal YieldTotal Yield = Earnings Yield + Dividend Yield, Earnings Yield = Net Income / Market Cap Dividend Yield = Total Dividends / Market Cap is 11%, Dividend Yield is 6.2%, ERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is 7.3%, FCF Yield is 6.3% Stock buyback supportStock Buyback 3Y Total is 2.3 Bil Attractive cash flow generationCFO LTM is 8.9 Bil, FCF LTM is 5.5 Bil Low stock price volatilityVol 12M is 29% Megatrend and thematic driversMegatrends include E-commerce & Digital Retail, E-commerce & DTC Adoption, Automation & Robotics, and Future of Freight. Show more. | Weak multi-year price returns2Y Excs Rtn is -49%, 3Y Excs Rtn is -95% | Weak revenue growthRev Chg 3Y AvgRevenue Change % averaged over trailing 3 years is -2.2% Key risksUPS key risks include [1] potential operational disruptions from ongoing labor disputes with the Teamsters union and [2] a significant revenue impact from its strategic decision to drastically reduce volume from its former largest customer, Show more. |
| Attractive yieldTotal YieldTotal Yield = Earnings Yield + Dividend Yield, Earnings Yield = Net Income / Market Cap Dividend Yield = Total Dividends / Market Cap is 11%, Dividend Yield is 6.2%, ERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is 7.3%, FCF Yield is 6.3% |
| Stock buyback supportStock Buyback 3Y Total is 2.3 Bil |
| Attractive cash flow generationCFO LTM is 8.9 Bil, FCF LTM is 5.5 Bil |
| Low stock price volatilityVol 12M is 29% |
| Megatrend and thematic driversMegatrends include E-commerce & Digital Retail, E-commerce & DTC Adoption, Automation & Robotics, and Future of Freight. Show more. |
| Weak multi-year price returns2Y Excs Rtn is -49%, 3Y Excs Rtn is -95% |
| Weak revenue growthRev Chg 3Y AvgRevenue Change % averaged over trailing 3 years is -2.2% |
| Key risksUPS key risks include [1] potential operational disruptions from ongoing labor disputes with the Teamsters union and [2] a significant revenue impact from its strategic decision to drastically reduce volume from its former largest customer, Show more. |
Qualitative Assessment
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United Parcel Service (UPS) stock has lost about 5% since 5/31/2026 because of the following key factors:
1. Fiscal Q2 2026 Earnings Beat and Raised Full-Year Guidance Offset by Restructuring Costs.
United Parcel Service reported strong fiscal Q2 2026 results on July 28, 2026, with non-GAAP adjusted diluted earnings per share (EPS) of $1.76, exceeding analyst expectations of $1.65 by 6.67%. Consolidated revenues also surpassed estimates, reaching $22.8 billion, a 7.6% increase year-over-year compared to analyst estimates of $21.86 billion. Furthermore, the company raised its full-year 2026 consolidated revenue outlook to approximately $91.2 billion and its non-GAAP adjusted operating profit target to approximately $8.65 billion, with non-GAAP adjusted diluted EPS guidance rising to approximately $7.22. However, GAAP results included significant after-tax transformation charges of $891 million, or $1.05 per diluted share, primarily related to employee separation costs from the Driver Choice Program, which tempered the positive financial beat.
2. Completion of Amazon Volume Reduction and Network Optimization Initiatives.
A key factor was the successful completion of UPS's Amazon volume "glide-down" and network reconfiguration initiatives in June 2026. This strategic move involved eliminating approximately two million pieces per day of lower-quality Amazon volume and resulted in the removal of roughly $4.5 billion in related expenses. The company also announced a new global operating model, effective September 1, 2026, to accelerate profitable growth and better leverage its worldwide network. These efficiency programs, including Network Reconfiguration and Efficiency Reimagined, are expected to yield approximately $3 billion in benefits for the full year 2026, with $1.2 billion already realized in the first half of fiscal 2026.
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United Parcel Service (UPS) stock has lost about 5% since 5/31/2026 because of the following key factors:
1. Fiscal Q2 2026 Earnings Beat and Raised Full-Year Guidance Offset by Restructuring Costs.
United Parcel Service reported strong fiscal Q2 2026 results on July 28, 2026, with non-GAAP adjusted diluted earnings per share (EPS) of $1.76, exceeding analyst expectations of $1.65 by 6.67%. Consolidated revenues also surpassed estimates, reaching $22.8 billion, a 7.6% increase year-over-year compared to analyst estimates of $21.86 billion. Furthermore, the company raised its full-year 2026 consolidated revenue outlook to approximately $91.2 billion and its non-GAAP adjusted operating profit target to approximately $8.65 billion, with non-GAAP adjusted diluted EPS guidance rising to approximately $7.22. However, GAAP results included significant after-tax transformation charges of $891 million, or $1.05 per diluted share, primarily related to employee separation costs from the Driver Choice Program, which tempered the positive financial beat.
2. Completion of Amazon Volume Reduction and Network Optimization Initiatives.
A key factor was the successful completion of UPS's Amazon volume "glide-down" and network reconfiguration initiatives in June 2026. This strategic move involved eliminating approximately two million pieces per day of lower-quality Amazon volume and resulted in the removal of roughly $4.5 billion in related expenses. The company also announced a new global operating model, effective September 1, 2026, to accelerate profitable growth and better leverage its worldwide network. These efficiency programs, including Network Reconfiguration and Efficiency Reimagined, are expected to yield approximately $3 billion in benefits for the full year 2026, with $1.2 billion already realized in the first half of fiscal 2026.
3. Mixed Analyst Sentiment Amidst Broader Logistics Market Dynamics.
Despite the positive earnings and strategic operational advancements, analyst sentiment remained cautiously optimistic, with an average consensus rating of "Hold" and a 12-month price target of $117.41 as of August 24, 2026. While some firms raised price targets and maintained "Buy" ratings, Zacks Research cut its fiscal Q3 2026 EPS forecast, although it raised longer-term outlooks for fiscal years 2027 and 2028, indicating near-term caution. The broader logistics market in fiscal Q3 2026 is experiencing tightening capacity due to regulatory actions and a Supreme Court ruling affecting broker liability, leading to upward pressure on rates. Additionally, both UPS and FedEx announced increased holiday shipping surcharges for 2026, with basic residential Ground charges rising 23% to 25%, reflecting both pricing power and the prevailing "volatility as the norm" in the supply chain landscape.
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Stock Movement Drivers
Fundamental Drivers
The -2.5% change in UPS stock from 5/31/2026 to 9/15/2026 was primarily driven by a -14.5% change in the company's Net Income Margin (%).| (LTM values as of) | 5312026 | 9152026 | Change |
|---|---|---|---|
| Stock Price ($) | 105.02 | 102.35 | -2.5% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 88,317 | 89,930 | 1.8% |
| Net Income Margin (%) | 5.9% | 5.1% | -14.5% |
| P/E Multiple | 17.0 | 19.1 | 12.1% |
| Shares Outstanding (Mil) | 850 | 851 | -0.1% |
| Cumulative Contribution | -2.5% |
Market Drivers
5/31/2026 to 9/15/2026| Return | Correlation | |
|---|---|---|
| UPS | -2.5% | |
| Market (SPY) | 0.1% | 39.8% |
| Sector (XLI) | -2.5% | 42.3% |
Fundamental Drivers
The -8.8% change in UPS stock from 2/28/2026 to 9/15/2026 was primarily driven by a -19.1% change in the company's Net Income Margin (%).| (LTM values as of) | 2282026 | 9152026 | Change |
|---|---|---|---|
| Stock Price ($) | 112.25 | 102.35 | -8.8% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 88,661 | 89,930 | 1.4% |
| Net Income Margin (%) | 6.3% | 5.1% | -19.1% |
| P/E Multiple | 17.1 | 19.1 | 11.4% |
| Shares Outstanding (Mil) | 849 | 851 | -0.2% |
| Cumulative Contribution | -8.8% |
Market Drivers
2/28/2026 to 9/15/2026| Return | Correlation | |
|---|---|---|
| UPS | -8.8% | |
| Market (SPY) | 10.7% | 42.1% |
| Sector (XLI) | -4.4% | 47.2% |
Fundamental Drivers
The 24.7% change in UPS stock from 8/31/2025 to 9/15/2026 was primarily driven by a 57.1% change in the company's P/E Multiple.| (LTM values as of) | 8312025 | 9152026 | Change |
|---|---|---|---|
| Stock Price ($) | 82.05 | 102.35 | 24.7% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 90,313 | 89,930 | -0.4% |
| Net Income Margin (%) | 6.3% | 5.1% | -19.9% |
| P/E Multiple | 12.1 | 19.1 | 57.1% |
| Shares Outstanding (Mil) | 847 | 851 | -0.5% |
| Cumulative Contribution | 24.7% |
Market Drivers
8/31/2025 to 9/15/2026| Return | Correlation | |
|---|---|---|
| UPS | 24.7% | |
| Market (SPY) | 18.4% | 34.6% |
| Sector (XLI) | 12.2% | 42.9% |
Fundamental Drivers
The -28.3% change in UPS stock from 8/31/2023 to 9/15/2026 was primarily driven by a -51.2% change in the company's Net Income Margin (%).| (LTM values as of) | 8312023 | 9152026 | Change |
|---|---|---|---|
| Stock Price ($) | 142.69 | 102.35 | -28.3% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 96,174 | 89,930 | -6.5% |
| Net Income Margin (%) | 10.4% | 5.1% | -51.2% |
| P/E Multiple | 12.3 | 19.1 | 55.5% |
| Shares Outstanding (Mil) | 860 | 851 | 1.1% |
| Cumulative Contribution | -28.3% |
Market Drivers
8/31/2023 to 9/15/2026| Return | Correlation | |
|---|---|---|
| UPS | -28.3% | |
| Market (SPY) | 74.1% | 40.2% |
| Sector (XLI) | 62.5% | 46.3% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| UPS Return | 30% | -15% | -6% | -16% | -16% | 8% | -21% |
| Peers Return | 39% | -20% | 26% | -0% | 21% | 25% | 111% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 11% | 103% |
Monthly Win Rates [3] | |||||||
| UPS Win Rate | 58% | 67% | 50% | 33% | 58% | 56% | |
| Peers Win Rate | 62% | 42% | 58% | 52% | 67% | 60% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 44% | |
Max Drawdowns [4] | |||||||
| UPS Max Drawdown | -17% | -30% | -30% | -22% | -36% | -20% | |
| Peers Max Drawdown | -16% | -34% | -19% | -22% | -28% | -21% | |
| S&P 500 Max Drawdown | -5% | -25% | -10% | -8% | -19% | -9% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: FDX, ODFL, CHRW, EXPD, JBHT. See UPS Returns vs. Peers.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 9/15/2026 (YTD)
How Low Can It Go
| Event | UPS | S&P 500 |
|---|---|---|
| 2025 US Tariff Shock | ||
| % Loss | -20.1% | -18.8% |
| % Gain to Breakeven | 25.1% | 23.1% |
| Time to Breakeven | 289 days | 79 days |
| 2020 COVID-19 Crash | ||
| % Loss | -18.5% | -33.7% |
| % Gain to Breakeven | 22.7% | 50.9% |
| Time to Breakeven | 85 days | 140 days |
| Q4 2018 Fed Policy Error / Growth Scare | ||
| % Loss | -23.0% | -19.2% |
| % Gain to Breakeven | 29.9% | 23.8% |
| Time to Breakeven | 213 days | 105 days |
| 2015-2016 China Devaluation / Global Growth Scare | ||
| % Loss | -13.2% | -12.2% |
| % Gain to Breakeven | 15.2% | 13.9% |
| Time to Breakeven | 55 days | 62 days |
| 2011 US Debt Ceiling Crisis & European Contagion | ||
| % Loss | -16.4% | -17.9% |
| % Gain to Breakeven | 19.6% | 21.8% |
| Time to Breakeven | 119 days | 123 days |
| 2010 Eurozone Sovereign Debt Crisis / Flash Crash | ||
| % Loss | -16.6% | -15.4% |
| % Gain to Breakeven | 19.9% | 18.2% |
| Time to Breakeven | 63 days | 125 days |
In The Past
United Parcel Service's stock fell -20.1% during the 2025 US Tariff Shock. Such a loss loss requires a 25.1% gain to breakeven.
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Asset Allocation
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| Event | UPS | S&P 500 |
|---|---|---|
| 2025 US Tariff Shock | ||
| % Loss | -20.1% | -18.8% |
| % Gain to Breakeven | 25.1% | 23.1% |
| Time to Breakeven | 289 days | 79 days |
| Q4 2018 Fed Policy Error / Growth Scare | ||
| % Loss | -23.0% | -19.2% |
| % Gain to Breakeven | 29.9% | 23.8% |
| Time to Breakeven | 213 days | 105 days |
| 2008-2009 Global Financial Crisis | ||
| % Loss | -45.6% | -53.4% |
| % Gain to Breakeven | 83.8% | 114.4% |
| Time to Breakeven | 402 days | 1085 days |
In The Past
United Parcel Service's stock fell -20.1% during the 2025 US Tariff Shock. Such a loss loss requires a 25.1% gain to breakeven.
Preserve Wealth
Limiting losses and compounding gains is essential to preserving wealth.
Asset Allocation
Actively managed asset allocation strategies protect wealth. Learn more.
About United Parcel Service (UPS)
United Parcel Service (UPS) is a global leader in logistics and package delivery. The company primarily operates through two core segments: U.S. Domestic Package and International Package. The U.S. Domestic segment provides time-definite delivery services for letters, documents, small packages, and palletized freight across the United States, utilizing an extensive network of air and ground transportation.
The International Package segment extends UPS's reach worldwide, offering guaranteed day and time-definite international shipping services to regions including Europe, Asia Pacific, Canada, Latin America, the Indian sub-continent, the Middle East, and Africa, spanning approximately 200 countries and territories. This global network is crucial for businesses and individuals requiring reliable cross-border shipping.
Beyond traditional package delivery, UPS offers a comprehensive suite of supply chain and specialized services. These include international air and ocean freight forwarding, customs brokerage, distribution, post-sales support, and consulting services. The company also provides truckload brokerage, advanced supply chain solutions tailored for the healthcare and life sciences sectors, and various shipping, visibility, and billing technologies, catering to a diverse range of individual and business customers globally.
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Here are a few analogies for United Parcel Service (UPS):
- Like FedEx.
- The private, global equivalent of the U.S. Postal Service.
- Imagine the Amazon delivery system, but for any company or individual worldwide.
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- Package Delivery Services: Provides time-definite delivery of letters, documents, small packages, and palletized freight through air and ground services, both domestically and internationally.
- Freight Forwarding: Offers international air and ocean freight forwarding services.
- Customs Brokerage: Assists clients with customs clearance and compliance for international shipments.
- Logistics and Distribution Solutions: Includes distribution, post-sales support, and specialized supply chain solutions for industries such as healthcare.
- Truckload Brokerage: Arranges full truckload transportation services for businesses.
- Technology Solutions: Develops and provides shipping, visibility, and billing technologies to enhance logistics management.
- Financial and Insurance Services: Offers financial and insurance products related to its transportation and logistics operations.
- Consulting Services: Provides expert advice on logistics and supply chain optimization.
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United Parcel Service (UPS) primarily sells its services to other companies (Business-to-Business or B2B) rather than individuals. Due to the vast and diverse nature of its customer base, spanning virtually all industries globally, UPS does not publicly disclose the names of its individual major customer companies. Its services are integral to the supply chains of countless businesses worldwide.
However, the major categories of companies that rely heavily on UPS for their operations include:
- E-commerce Businesses and Retailers: Companies of all sizes, from large online marketplaces to small direct-to-consumer brands, use UPS for shipping products to their customers (both domestically and internationally).
- Manufacturers and Distributors: Businesses across various sectors (e.g., automotive, electronics, consumer goods, industrial products) utilize UPS for transporting raw materials, components, finished goods, and managing complex supply chains.
- Healthcare and Life Sciences Companies: As explicitly mentioned in the company description, this sector relies on UPS for specialized logistics, including temperature-controlled shipping, urgent deliveries, and compliance with strict regulations for pharmaceuticals, medical devices, and other sensitive materials.
- Small and Medium-sized Businesses (SMBs): A broad array of SMBs across virtually every industry use UPS for their shipping needs, from documents and small packages to freight services.
While individuals do use UPS for personal shipping (Consumer-to-Consumer or C2C) and returning items to businesses, the core of UPS's revenue and operational focus lies in serving the complex logistics and shipping requirements of other businesses.
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Carol Tomé, Chief Executive Officer
Carol Tomé has served as the Chief Executive Officer of UPS since June 2020, making her the first female CEO and the first external hire for the role in the company's history, although she had been a member of the Board since 2003. Before joining UPS, Ms. Tomé spent nearly two decades as the Executive Vice President and Chief Financial Officer of The Home Depot, from 1995 to 2019. During her tenure at The Home Depot, she was instrumental in guiding the company through the financial recession and housing crisis, doubling sales to over $108 billion, and achieving a 450% increase in shareholder value. Her early career included roles as a commercial lender at United Bank of Denver (now Wells Fargo) and leadership positions at Johns-Manville Corporation and Riverwood International Corporation.
Brian Dykes, Executive Vice President and Chief Financial Officer
Brian Dykes was appointed Executive Vice President and Chief Financial Officer of UPS in July 2024. He is a veteran of UPS with 25 years of service, having held various senior roles within the company's finance and accounting, corporate treasury, mergers and acquisitions, business intelligence, and business development functions, both in the United States and internationally. Prior to his current role, he served as Senior Vice President, Global Finance and Planning since April 2023.
Nando Cesarone, Executive Vice President and President U.S.
Nando Cesarone serves as the Executive Vice President and President U.S. for UPS, where he is responsible for overseeing the company's U.S. small package, transportation, and airline operations. He began his career at UPS in 1990 as a preloader, benefiting from the company's tuition reimbursement program, and later became a package car driver. His extensive international experience with UPS includes serving as President of UPS International, President of UPS Europe, and President of the Asia Pacific Region, where he led expansion efforts in emerging markets and China.
Kate Gutmann, Executive Vice President & President International, Healthcare and Supply Chain Solutions
Kate Gutmann holds the position of Executive Vice President & President International, Healthcare and Supply Chain Solutions at UPS. She is responsible for global sales, solutions, and customer engagement strategies, and also oversees the UPS Capital and The UPS Store business units worldwide. Ms. Gutmann started her career with UPS in 1989 as a marketing intern while studying at Siena College. She has progressed through numerous sales and marketing roles with increasing responsibility, including President of Worldwide Sales and Vice President of Marketing for the UPS Europe, Middle East, and Africa Region.
Bala Subramanian, Executive Vice President & Chief Digital and Technology Officer
Bala Subramanian is the Executive Vice President & Chief Digital and Technology Officer at UPS. He joined the company in 2020, bringing significant expertise in digital transformation, technology innovation, and strategic leadership. His career prior to UPS included various leadership roles with several major corporations.
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The key risks to United Parcel Service (UPS) include intense competition and shifts in the e-commerce landscape, labor costs and union relations, and fuel price volatility and rising operating expenses.
Competitive Landscape and E-commerce Shifts
UPS operates in a highly competitive industry with established rivals such as FedEx, DHL Express, and national postal services. A significant and evolving threat comes from Amazon Logistics, which has been rapidly expanding its sorting and distribution capabilities and handling a growing portion of its own package deliveries, with the potential to offer third-party services in the future. This intense competition necessitates continuous investment in network efficiency, technological innovation, and service diversification to maintain market share. In response to these shifts, UPS has been strategically reducing its reliance on Amazon's package volume and pivoting towards higher-margin segments like small and medium-sized businesses (SMBs) and healthcare logistics.
Labor Costs and Union Relations
UPS has a large, unionized workforce, primarily represented by the Teamsters. Labor costs are a significant challenge, with recent collective bargaining agreements leading to substantial increases in expenses. The company has faced and continues to navigate potential labor disputes, including strike threats, which can lead to operational disruptions and increased costs. Efforts by UPS to reduce its workforce through voluntary buyout plans, aimed at improving profitability and aligning staffing with reduced package volumes (particularly from Amazon), have also created tension and disputes with the union, which views these actions as potential violations of existing contracts.
Fuel Price Volatility and Operating Expenses
As a transportation and logistics company operating a large fleet of vehicles and aircraft, UPS is highly sensitive to fluctuations in fuel prices. While UPS implements fuel surcharges to offset these costs, significant or sustained increases in diesel and jet fuel prices directly impact operating expenses. These increased costs can put pressure on profitability and may necessitate passing on higher shipping costs to customers, potentially affecting demand for UPS's services. Beyond fuel, rising operating expenses generally, including compensation and benefits, also contribute to financial pressures.
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The clear emerging threat for United Parcel Service (UPS) is the continued and extensive expansion of major e-commerce retailers, particularly Amazon, into developing and operating their own in-house logistics and delivery networks. Amazon, a significant former customer of UPS, has heavily invested in its own fleet of aircraft, trucks, vans, and last-mile delivery services, effectively internalizing a substantial volume of packages that were previously handled by traditional carriers like UPS. This trend represents a direct competitive challenge, as a major source of parcel volume is diverted to an internal network, significantly altering the competitive landscape and putting pressure on UPS's package delivery segments by removing a large customer and establishing a formidable new competitor.
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United Parcel Service (UPS) operates in several large addressable markets for its main products and services:
- Global Courier, Express, and Parcel (CEP) Market: This market, which includes both domestic and international package delivery, was valued at approximately USD 956.19 billion in 2025. It is projected to grow significantly, reaching an estimated USD 2,976.01 billion by 2033.
- U.S. Domestic Parcel Market: For its U.S. domestic package delivery services, the market generated USD 196 billion in revenue in 2025.
- Global Freight Forwarding Market: The global freight forwarding market, encompassing international air and ocean freight forwarding, was valued at USD 230.68 billion in 2025. This market is projected to grow to approximately USD 365.15 billion by 2035.
- Global Third-Party Logistics (3PL) Market: This broad market, covering services such as international air and ocean freight forwarding, customs brokerage, distribution and post-sales, and truckload brokerage, was valued at USD 1.6 trillion in 2025. The 3PL market is expected to expand to USD 4.3 trillion by 2035.
- Global Healthcare Third-Party Logistics Market: For its specialized supply chain solutions to the healthcare and life sciences industry, the global healthcare third-party logistics market was estimated at USD 261.39 billion in 2024. This specific segment is projected to grow to USD 406.36 billion by 2030.
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United Parcel Service (UPS) is strategically positioning itself for future revenue growth over the next 2-3 years by focusing on several key drivers:
- Expansion in Higher-Margin Markets: UPS is prioritizing growth in premium segments such as healthcare logistics and small and medium-sized businesses (SMBs/SMEs). This involves reducing lower-margin volume, for instance, by significantly decreasing its shipments for a major customer like Amazon, to concentrate on more profitable package types. The company aims to become the world's leading provider of complex healthcare logistics and has demonstrated strong growth in this area, targeting $20 billion in healthcare revenue by 2026.
- Network Optimization and Automation: Under its "Network of the Future" initiative, UPS is investing heavily in optimizing and automating its core integrated network. This strategy is designed to lower the cost to serve, enhance efficiency, and support anticipated volume growth. Plans include more than tripling the number of automated buildings in its network by the end of 2028, largely through implementing automation projects in existing facilities, and reconfiguring its U.S. network to yield substantial savings.
- Improved Revenue Quality and Strategic Pricing: UPS is focused on driving higher revenue per piece by implementing average rate increases across its ground, air, and international services. This emphasis on "revenue quality" is a core part of its strategy, which includes adjusting customer volume to focus on more profitable package types and insourcing services like SurePost to improve efficiency and control over final-mile delivery.
- International Market Expansion: The company continues to target growth in high-growth international markets. This involves efficiently connecting domestic and export customers to its global network, leveraging its established presence in over 200 countries and territories.
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Share Repurchases
- In January 2023, UPS approved a new share repurchase authorization for $5.0 billion of Class A and Class B common stock, replacing a previous 2021 authorization.
- UPS repurchased $2.2 billion in shares in 2023, $500 million in 2024, and $1 billion in 2025.
- As of December 31, 2024, $2.3 billion remained available under the 2023 share repurchase authorization.
Outbound Investments
- UPS acquired Frigo-Trans in January 2025 and Andlauer Healthcare Group (AHG) in November 2025, with recent strategic mergers and acquisitions focusing on healthcare logistics.
- The company sold Coyote in the third quarter of 2024.
Capital Expenditures
- Capital expenditures were $4.194 billion in 2021, $4.769 billion in 2022, $5.158 billion in 2023, $3.909 billion in 2024, and $3.685 billion in 2025.
- Expected capital expenditures for 2026 are approximately $3.0 billion, marking a 10-year low.
- The primary focus of capital expenditures includes network reconfiguration, automation investments, and capacity rightsizing, emphasizing a leaner, more productive network.
Peer Outperformance in Air Freight & Logistics
| Ticker | Name | Rev Growth 3Y Avg | P/E | 1Y | 3Y | 5Y | 5Y Gap |
|---|---|---|---|---|---|---|---|
| UPS | United Parcel Service | -2.2% | 19.1x | 29.8% | -24.3% | -32.2% | — |
| CHRW | C.H. Robinson Worldwide | -5.3% | 29.5x | 20.1% | 86.3% | 96.6% | +129pp |
| FDX | FedEx | 1.8% | 16.7x | 73.4% | 60.9% | 64.6% | +97pp |
| EXPD | Expeditors International of Washington | 0.9% | 27.6x | 57.8% | 69.6% | 62.1% | +94pp |
| Industry | Names | 1Y med | 3Y med | 5Y med | Top 3 by 5Y |
|---|---|---|---|---|---|
| Construction & Engineering | 31 | 10.9% | 96.8% | 180.5% | CDNL 2493% · FIX 2206% · STRL 1934% |
| Marine Transportation | 5 | 79.5% | 63.5% | 166.9% | HOS 46479% · MATX 201% · KEX 167% |
| Construction Machinery & Heavy Transportation Equipment | 13 | 6.7% | 60.4% | 124.0% | CAT 319% · ALSN 264% · WAB 223% |
| Aerospace & Defense | 54 | -4.4% | 75.4% | 72.9% | ATI 985% · FTAI 881% · HWM 625% |
| Rail Transportation | 7 | 30.8% | 64.5% | 43.4% | FSTR 140% · CSX 68% · UNP 56% |
| Trading Companies & Distributors | 19 | 5.0% | 38.9% | 38.0% | DXPE 561% · AIT 288% · WCC 201% |
| Industrial Machinery & Supplies & Components | 72 | 7.6% | 43.3% | 36.4% | CRS 1276% · PSIX 919% · GHM 582% |
| Cargo Ground Transportation | 16 | 34.9% | 6.4% | 32.7% | XPO 249% · R 240% · CVLG 238% |
| Passenger Ground Transportation | 3 | -23.2% | 39.1% | 26.3% | UBER 81% · CAR 26% · LYFT -70% |
| Diversified Support Services | 33 | 10.2% | 29.6% | 25.3% | LIME 3445% · TH 417% · WLFC 351% |
| Electrical Components & Equipment | 41 | 9.4% | 55.2% | 19.4% | POWL 2263% · BE 1266% · VRT 882% |
| Building Products | 33 | -14.6% | 2.9% | 17.9% | LMB 636% · GFF 375% · PPIH 284% |
| Industrial Conglomerates | 17 | 7.1% | 1.9% | 7.8% | RCMT 397% · CSW 133% · CSL 73% |
| Environmental & Facilities Services | 29 | -9.4% | 21.1% | -4.0% | CECO 875% · NVRI 372% · ADUR 372% |
| Agricultural & Farm Machinery | 17 | 9.9% | 6.5% | -6.9% | BLBD 207% · DE 106% · GENC 47% |
| Research & Consulting Services | 13 | -10.3% | -23.5% | -7.9% | HURN 201% · CRAI 91% · GRNQ 57% |
| Data Processing & Outsourced Services | 6 | -31.4% | -13.1% | -23.7% | EXLS 47% · BR 10% · G -23% |
| Passenger Airlines | 11 | 2.1% | 0.8% | -30.0% | LTM 3083% · UAL 140% · SKYW 109% |
| Office Services & Supplies | 9 | 7.0% | 24.6% | -32.0% | PBI 200% · TILE 141% · HNI 47% |
| Human Resource & Employment Services | 22 | 5.8% | -19.7% | -38.1% | BBSI 88% · ADP 56% · PAYX 26% |
| Air Freight & Logistics ← | 12 | -8.2% | -22.6% | -38.3% | CHRW 97% · FDX 65% · EXPD 62% |
| Security & Alarm Services | 10 | -30.3% | 11.4% | -39.7% | CIX 162% · MG 107% · NL 59% |
| Airport Services | 3 | -72.2% | -79.7% | -58.1% | JOBY -29% · ASLE -58% · UP -100% |
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Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 187.43 |
| Mkt Cap | 31.6 |
| Rev LTM | 14,849 |
| Op Inc LTM | 1,316 |
| FCF LTM | 1,107 |
| FCF 3Y Avg | 894 |
| CFO LTM | 1,495 |
| CFO 3Y Avg | 1,512 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 2.6% |
| Rev Chg 3Y Avg | -2.1% |
| Rev Chg Q | 15.9% |
| QoQ Delta Rev Chg LTM | 3.9% |
| Op Inc Chg LTM | 7.9% |
| Op Inc Chg 3Y Avg | -2.7% |
| Op Mgn LTM | 7.4% |
| Op Mgn 3Y Avg | 7.7% |
| QoQ Delta Op Mgn LTM | 0.1% |
| CFO/Rev LTM | 9.6% |
| CFO/Rev 3Y Avg | 9.4% |
| FCF/Rev LTM | 6.9% |
| FCF/Rev 3Y Avg | 5.1% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 31.6 |
| P/S | 1.6 |
| P/Op Inc | 21.9 |
| P/EBIT | 21.9 |
| P/E | 28.6 |
| P/CFO | 21.1 |
| Total Yield | 4.7% |
| Dividend Yield | 1.2% |
| FCF Yield 3Y Avg | 4.1% |
| D/E | 0.1 |
| Net D/E | 0.1 |
Returns
| Median | |
|---|---|
| Name | |
| 1M Rtn | -1.4% |
| 3M Rtn | -6.5% |
| 6M Rtn | 8.8% |
| 12M Rtn | 43.8% |
| 3Y Rtn | 52.7% |
| 1M Excs Rtn | 1.1% |
| 3M Excs Rtn | -6.8% |
| 6M Excs Rtn | -3.9% |
| 12M Excs Rtn | 28.8% |
| 3Y Excs Rtn | -13.4% |
Comparison Analyses
Segment Financials
Revenue by Segment| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| United States (U.S.) Domestic Package | 59,519 | 60,376 | 60,205 | 60,317 | |
| International Package | 18,576 | 17,960 | 17,831 | 19,541 | |
| Other revenues | 10,566 | 12,734 | 12,922 | ||
| Single Segment | 100,338 | ||||
| Supply Chain Solutions | 17,429 | ||||
| Total | 88,661 | 91,070 | 90,958 | 100,338 | 97,287 |
| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| United States (U.S.) Domestic Package | 3,926 | 4,345 | 5,156 | 6,997 | 6,436 |
| International Package | 2,873 | 3,191 | 3,231 | 4,326 | 4,646 |
| Other profit/(loss) | 1,068 | 932 | 754 | ||
| Supply Chain Solutions | 1,771 | 1,728 | |||
| Total | 7,867 | 8,468 | 9,141 | 13,094 | 12,810 |
| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| United States (U.S.) Domestic Package | 38,359 | 38,657 | 38,368 | 38,303 | 35,746 |
| International Package | 18,214 | 18,300 | 17,587 | 17,670 | 17,225 |
| Other assets | 12,693 | 9,850 | |||
| Unallocated assets | 3,824 | 3,263 | 3,657 | 4,744 | 6,878 |
| Supply Chain Solutions | 11,245 | 10,407 | 9,556 | ||
| Total | 73,090 | 70,070 | 70,857 | 71,124 | 69,405 |
Price Behavior
| Market Price | $102.35 | |
| Market Cap ($ Bil) | 87.1 | |
| First Trading Date | 11/10/1999 | |
| Distance from 52W High | -11.7% | |
| 50 Days | 200 Days | |
| DMA Price | $105.74 | $102.27 |
| DMA Trend | up | down |
| Distance from DMA | -3.2% | 0.1% |
| 3M | 1YR | |
| Volatility | 28.7% | 29.3% |
| Downside Capture | 87.34 | 70.54 |
| Upside Capture | 52.30 | 89.22 |
| Correlation (SPY) | 28.8% | 35.1% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | 1.39 | 0.72 | 0.93 | 0.99 | 0.80 | 0.77 |
| Up Beta | 1.18 | 1.51 | 1.16 | 1.18 | 0.75 | 0.81 |
| Down Beta | -1.36 | -0.54 | 0.97 | 0.97 | 0.89 | 0.61 |
| Up Capture | 161% | 49% | 76% | 68% | 79% | 37% |
| Bmk +ve Days | 10 | 21 | 32 | 68 | 138 | 427 |
| Stock +ve Days | 10 | 21 | 31 | 66 | 138 | 381 |
| Down Capture | 223% | 98% | 89% | 113% | 79% | 100% |
| Bmk -ve Days | 11 | 21 | 32 | 59 | 113 | 324 |
| Stock -ve Days | 11 | 21 | 33 | 61 | 113 | 365 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with UPS | |
|---|---|---|---|---|
| UPS | 29.4% | 29.3% | 0.88 | - |
| Sector ETF (XLI) | 12.6% | 17.2% | 0.52 | 43.5% |
| Equity (SPY) | 16.3% | 12.8% | 0.90 | 35.0% |
| Gold (GLD) | 17.6% | 29.3% | 0.55 | 12.9% |
| Commodities (DBC) | 48.6% | 20.6% | 1.82 | -19.5% |
| Real Estate (VNQ) | 5.3% | 13.5% | 0.13 | 25.8% |
| Bitcoin (BTCUSD) | -33.1% | 43.8% | -0.79 | 6.3% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with UPS | |
|---|---|---|---|---|
| UPS | -7.7% | 28.8% | -0.26 | - |
| Sector ETF (XLI) | 12.1% | 17.6% | 0.52 | 55.4% |
| Equity (SPY) | 12.4% | 17.2% | 0.55 | 50.5% |
| Gold (GLD) | 18.7% | 18.8% | 0.80 | 5.3% |
| Commodities (DBC) | 11.7% | 19.5% | 0.47 | 7.4% |
| Real Estate (VNQ) | 0.8% | 18.9% | -0.06 | 44.7% |
| Bitcoin (BTCUSD) | 10.7% | 52.5% | 0.38 | 12.9% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with UPS | |
|---|---|---|---|---|
| UPS | 3.4% | 27.9% | 0.16 | - |
| Sector ETF (XLI) | 13.0% | 20.1% | 0.57 | 57.1% |
| Equity (SPY) | 15.1% | 18.0% | 0.71 | 55.1% |
| Gold (GLD) | 12.0% | 16.4% | 0.60 | 2.1% |
| Commodities (DBC) | 8.7% | 18.1% | 0.39 | 13.7% |
| Real Estate (VNQ) | 4.6% | 20.7% | 0.18 | 43.7% |
| Bitcoin (BTCUSD) | 63.4% | 66.2% | 1.03 | 7.4% |
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Returns Analyses
Earnings Returns History
Updated 8/28/2026| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 7/28/2026 | -6.6% | -5.4% | -5.4% |
| 4/28/2026 | -4.0% | -11.0% | -1.9% |
| 1/27/2026 | 0.2% | 3.1% | 7.9% |
| 10/28/2025 | 8.0% | 5.5% | 7.8% |
| 7/29/2025 | -10.6% | -16.3% | -12.3% |
| 4/29/2025 | -0.4% | -1.6% | 1.3% |
| 1/30/2025 | -14.1% | -16.4% | -9.8% |
| 10/24/2024 | 5.3% | 1.8% | 1.2% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 9 | 11 | 14 |
| # Negative | 15 | 13 | 10 |
| Median Positive | 5.3% | 4.0% | 4.5% |
| Median Negative | -6.6% | -7.0% | -8.6% |
| Max Positive | 14.1% | 20.7% | 20.9% |
| Max Negative | -14.1% | -16.4% | -12.5% |
| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 7/28/2026 | -6.6% | -5.4% | -5.4% |
| 4/28/2026 | -4.0% | -11.0% | -1.9% |
| 1/27/2026 | 0.2% | 3.1% | 7.9% |
| 10/28/2025 | 8.0% | 5.5% | 7.8% |
| 7/29/2025 | -10.6% | -16.3% | -12.3% |
| 4/29/2025 | -0.4% | -1.6% | 1.3% |
| 1/30/2025 | -14.1% | -16.4% | -9.8% |
| 10/24/2024 | 5.3% | 1.8% | 1.2% |
| 7/23/2024 | -12.1% | -11.4% | -10.1% |
| 4/23/2024 | 2.4% | 2.2% | 1.2% |
| 1/30/2024 | -8.2% | -12.0% | -5.4% |
| 10/26/2023 | -5.9% | -4.9% | 4.7% |
| 8/8/2023 | -0.9% | -2.8% | -10.1% |
| 4/25/2023 | -10.0% | -7.0% | -12.5% |
| 1/31/2023 | 4.7% | 6.7% | 4.4% |
| 10/25/2022 | -0.3% | 0.1% | 11.1% |
| 7/26/2022 | -3.4% | 4.0% | 10.1% |
| 4/26/2022 | -3.5% | -5.8% | -7.4% |
| 2/1/2022 | 14.1% | 11.3% | 5.3% |
| 10/26/2021 | 6.9% | 3.4% | 4.4% |
| 7/27/2021 | -7.0% | -8.5% | -7.4% |
| 4/27/2021 | 10.4% | 20.7% | 20.9% |
| 2/2/2021 | 2.6% | 4.6% | 3.3% |
| 10/28/2020 | -8.8% | -4.3% | 0.4% |
| SUMMARY STATS | |||
| # Positive | 9 | 11 | 14 |
| # Negative | 15 | 13 | 10 |
| Median Positive | 5.3% | 4.0% | 4.5% |
| Median Negative | -6.6% | -7.0% | -8.6% |
| Max Positive | 14.1% | 20.7% | 20.9% |
| Max Negative | -14.1% | -16.4% | -12.5% |
SEC Filings
Expand for More| Report Date | Filing Date | Filing |
|---|---|---|
| 06/30/2026 | 08/05/2026 | 10-Q |
| 03/31/2026 | 05/06/2026 | 10-Q |
| 12/31/2025 | 02/17/2026 | 10-K |
| 09/30/2025 | 11/05/2025 | 10-Q |
| 06/30/2025 | 08/06/2025 | 10-Q |
| 03/31/2025 | 05/07/2025 | 10-Q |
| 12/31/2024 | 02/18/2025 | 10-K |
| 09/30/2024 | 11/06/2024 | 10-Q |
| 06/30/2024 | 08/07/2024 | 10-Q |
| 03/31/2024 | 05/03/2024 | 10-Q |
| 12/31/2023 | 02/20/2024 | 10-K |
| 09/30/2023 | 11/01/2023 | 10-Q |
| 06/30/2023 | 08/08/2023 | 10-Q |
| 03/31/2023 | 05/03/2023 | 10-Q |
| 12/31/2022 | 02/21/2023 | 10-K |
| 09/30/2022 | 11/02/2022 | 10-Q |
| Report Date | Filing Date | Filing |
|---|---|---|
| 06/30/2026 | 08/05/2026 | 10-Q |
| 03/31/2026 | 05/06/2026 | 10-Q |
| 12/31/2025 | 02/17/2026 | 10-K |
| 09/30/2025 | 11/05/2025 | 10-Q |
| 06/30/2025 | 08/06/2025 | 10-Q |
| 03/31/2025 | 05/07/2025 | 10-Q |
| 12/31/2024 | 02/18/2025 | 10-K |
| 09/30/2024 | 11/06/2024 | 10-Q |
| 06/30/2024 | 08/07/2024 | 10-Q |
| 03/31/2024 | 05/03/2024 | 10-Q |
| 12/31/2023 | 02/20/2024 | 10-K |
| 09/30/2023 | 11/01/2023 | 10-Q |
| 06/30/2023 | 08/08/2023 | 10-Q |
| 03/31/2023 | 05/03/2023 | 10-Q |
| 12/31/2022 | 02/21/2023 | 10-K |
| 09/30/2022 | 11/02/2022 | 10-Q |
| 06/30/2022 | 08/03/2022 | 10-Q |
| 03/31/2022 | 05/04/2022 | 10-Q |
| 12/31/2021 | 02/22/2022 | 10-K |
| 09/30/2021 | 11/04/2021 | 10-Q |
| 06/30/2021 | 08/06/2021 | 10-Q |
| 03/31/2021 | 05/05/2021 | 10-Q |
| 12/31/2020 | 02/22/2021 | 10-K |
| 09/30/2020 | 11/02/2020 | 10-Q |
| 06/30/2020 | 08/04/2020 | 10-Q |
| 03/31/2020 | 05/08/2020 | 10-Q |
| 12/31/2019 | 02/20/2020 | 10-K |
| 09/30/2019 | 10/29/2019 | 10-Q |
Recent Forward Guidance
Updated 7/29/2026Latest: Q2 2026 Earnings Reported 7/28/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2026 Non-GAAP Adjusted Operating Profit | Reported | 8.65 Bil | ||||||
| 2026 Dividends | Reported | 5.40 Bil | 0 | Affirmed | Guidance: 5.40 Bil for 2026 | |||
| 2026 Revenue | Reported | 91.20 Bil | 1.7% | Raised | Guidance: 89.70 Bil for 2026 | |||
| 2026 Effective Tax Rate | Reported | 23.0% | 0 | Affirmed | Guidance: 23.0% for 2026 | |||
| 2026 Non-GAAP Adjusted Diluted EPS | Reported | 7.22 | ||||||
| 2026 Capital Expenditures | Reported | 3.00 Bil | 0 | Affirmed | Guidance: 3.00 Bil for 2026 | |||
Prior: Q1 2026 Earnings Reported 4/28/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2026 Dividends | Reported | 5.40 Bil | 0 | Affirmed | Guidance: 5.40 Bil for 2026 | |||
| 2026 Program Cost Savings | Reported | 3.00 Bil | 0 | Affirmed | Guidance: 3.00 Bil for 2026 | |||
| 2026 Revenue | Reported | 89.70 Bil | 0 | Affirmed | Guidance: 89.70 Bil for 2026 | |||
| 2026 Non-GAAP Adjusted Operating Expense Exclusions | Reported | 1.30 Bil | 1.40 Bil | |||||
| 2026 Non-GAAP Adjusted Operating Margin | Reported | 9.6% | 0 | Affirmed | Guidance: 9.6% for 2026 | |||
| 2026 Effective Tax Rate | Reported | 23.0% | ||||||
| 2026 Capital Expenditures | Reported | 3.00 Bil | 0 | Affirmed | Guidance: 3.00 Bil for 2026 | |||
Q4 2025 Earnings Reported 1/27/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2026 Dividends | Reported | 5.40 Bil | -1.8% | Lower New | Actual: 5.50 Bil for 2025 | |||
| 2026 Cost Savings | Reported | 3.00 Bil | ||||||
| 2026 Revenue | Reported | 89.70 Bil | ||||||
| 2026 Operating Margin | Reported | 9.6% | ||||||
| 2026 Capital Expenditures | Reported | 3.00 Bil | -14.3% | Lower New | Actual: 3.50 Bil for 2025 | |||
Q3 2025 Earnings Reported 10/28/2025
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q4 2025 Revenue | Reported | 24.00 Bil | ||||||
| Q4 2025 Operating Margin | Reported | 11.0% | 11.25% | 11.5% | ||||
| 2025 Dividends | Reported | 5.50 Bil | 0 | Affirmed | Guidance: 5.50 Bil for 2025 | |||
| 2025 Pension Contributions | Reported | 1.40 Bil | 0 | Affirmed | Guidance: 1.40 Bil for 2025 | |||
| 2025 Effective Tax Rate | Reported | 23.75% | 0.2% | Raised | Guidance: 23.5% for 2025 | |||
| 2025 Capital Expenditures | Reported | 3.50 Bil | 0 | Affirmed | Guidance: 3.50 Bil for 2025 | |||
| 2025 Share Repurchases | Reported | 1.00 Bil | 0 | Affirmed | Guidance: 1.00 Bil for 2025 | |||
Insider Activity
Updated 9/3/2026| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Brothers, Norman M JR | Chief Legal & Compliance Off | Direct | Sell | 1282026 | 106.15 | 25,014 | Form |
| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Brothers, Norman M JR | Chief Legal & Compliance Off | Direct | Sell | 1282026 | 106.15 | 25,014 | Form |
Investor Activity (13F)
Updated Sep 16, 2026Active managers (13F portfolio over $250M, at least 3 holdings) with a position over $5M that is either over 10% of their portfolio or held in a concentrated book of 50 or fewer total positions. Index/ETF, sovereign, bank, community-bank and charitable/donor-advised filers are excluded.
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Cove Private Wealth, LLC | $66.0 Mil | 15.0% | 185 | New | 13F |
| Drexel Morgan & Co. | $79.9 Mil | 11.7% | 60 | ADD +14.0% | 13F |
| Masters Capital Management LLC | $49.2 Mil | 7.3% | 44 | ADD +66.7% | 13F |
| Lone Peak Global Investors LLC | $26.1 Mil | 4.4% | 42 | ADD +52.2% | 13F |
| Powszechne Towarzystwo Emerytalne Allianz Polska S.A. | $8.3 Mil | 3.1% | 10 | Hold | 13F |
| Sound Shore Management Inc /CT/ | $71.6 Mil | 2.4% | 40 | New | 13F |
| Hi-Line Capital Management, LLC | $6.6 Mil | 2.1% | 32 | Hold | 13F |
| Fluent Financial, LLC | $5.6 Mil | 2.0% | 43 | TRIM -19.9% | 13F |
| Lodge Hill Capital, LLC | $10.3 Mil | 2.0% | 22 | New | 13F |
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Sound Shore Management Inc /CT/ | $71.6 Mil | 2.4% | 40 | New | 13F |
| Cove Private Wealth, LLC | $66.0 Mil | 15.0% | 185 | New | 13F |
| Lodge Hill Capital, LLC | $10.3 Mil | 2.0% | 22 | New | 13F |
| Masters Capital Management LLC | $49.2 Mil | 7.3% | 44 | ADD +66.7% | 13F |
| Lone Peak Global Investors LLC | $26.1 Mil | 4.4% | 42 | ADD +52.2% | 13F |
| Drexel Morgan & Co. | $79.9 Mil | 11.7% | 60 | ADD +14.0% | 13F |
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Drexel Morgan & Co. | $79.9 Mil | 11.7% | 60 | ADD +14.0% | 13F |
| Sound Shore Management Inc /CT/ | $71.6 Mil | 2.4% | 40 | New | 13F |
| Cove Private Wealth, LLC | $66.0 Mil | 15.0% | 185 | New | 13F |
| Masters Capital Management LLC | $49.2 Mil | 7.3% | 44 | ADD +66.7% | 13F |
| Lone Peak Global Investors LLC | $26.1 Mil | 4.4% | 42 | ADD +52.2% | 13F |
| Lodge Hill Capital, LLC | $10.3 Mil | 2.0% | 22 | New | 13F |
| Powszechne Towarzystwo Emerytalne Allianz Polska S.A. | $8.3 Mil | 3.1% | 10 | Hold | 13F |
| Hi-Line Capital Management, LLC | $6.6 Mil | 2.1% | 32 | Hold | 13F |
| Fluent Financial, LLC | $5.6 Mil | 2.0% | 43 | TRIM -19.9% | 13F |
UPS Trade Sentinel
Constructive
CONVICTION RATIONALE
Conviction is constructive, centered on a strategic pivot that is now showing tangible results. After intentionally shedding low-margin volume, Q2 2026 revenue growth accelerated to 7.6% and management raised its full-year outlook. The primary uncertainty is the pace of margin recovery, with the company guiding for significant U.S. domestic margin expansion in the second half of 2026.
STOCK ARCHETYPE
Transactional Logistics Network(Average Daily Volume) x (Average Revenue Per Piece) Margin expansion driven by a strategic shift in customer/product mix toward higher-revenue-per-piece shipments and improved network efficiency from cost-saving initiatives.
INVESTMENT THESIS
Evidence suggests a major strategic pivot is inflecting positively, prioritizing profitable volume over sheer scale.
- Q2 revenue growth accelerated to 7.6% YoY, a sharp reversal from prior declines.
- U.S. Domestic revenue per piece grew 9.3% in Q2, driven by better mix and pricing.
- SMBs, a key target, grew to 34.5% of U.S. volume, up 250 basis points YoY.
- Management raised full-year 2026 revenue guidance to approximately $91.2 billion.
- Adjusted U.S. Domestic operating profit grew 21% YoY in Q2 2026.
PRIMARY RISK
The reconfigured network may fail to deliver expected efficiencies, with transition costs and a weaker mix leading to sustained margin pressure below historical levels.
- Trailing-twelve-month operating margin is 7.3%, down from 9.3% a year ago.
- Q3 domestic operating margin is guided to ~7%, a sequential decline from Q2.
- Trailing operating expenses grew 3.6% while revenue declined 0.4%.
- A key competitor reports a trailing gross margin of 21.8% versus 16.6% for UPS.
- International margins face pressure from shifting trade lanes and higher fuel costs.
| KPI | Status | Rationale |
|---|---|---|
| U.S. Domestic Average Daily Volume | down 3.3% year-over-year for Q2 2026 - Turning around | The negative growth is a deliberate part of the company's strategy to reduce lower-quality volume from its largest customer, a plan management states was completed in the quarter. Within the total, premium segments like SMBs are growing, with volume up 4.3% YoY. |
| U.S. Domestic Revenue Per Piece | up 9.3% year-over-year for Q2 2026 - Accelerating | Growth is driven by a combination of 'healthy base rates and customer mix improvement' as well as higher fuel surcharges. This reflects the company's focus on revenue quality and a successful shift towards higher-value customers. |
| U.S. Domestic Average Daily Package Volume | 16,002 thousands (Q2 2026) | Measures the volume of packages flowing through the core U.S. network, indicating demand and network utilization. Current declines reflect the strategic reduction of low-margin volume. |
| U.S. Domestic Average Revenue Per Piece | $14.24 (Q2 2026) | Tracks the average revenue generated per package, reflecting the success of pricing actions and the strategic shift towards higher-value customer and product mix. |
| SMB Penetration of Total U.S. Volume | 34.5% (Q2 2026) | Measures progress in shifting the customer mix towards the strategically important small- and medium-sized business segment, which is considered higher-yielding. |
Strategic Inflection vs. Transitional Friction
BULL VIEW
The successful Q2 revenue re-acceleration to 7.6% and raised full-year guidance prove the painful, intentional volume reduction is complete and the company is now poised for profitable growth.
CORE TENSION
Can strong revenue per piece growth (+9.3%) and SMB gains (+4.3% volume) overcome the drag from network transition costs that drove the weak Q3 margin guidance?
PREVAILING SENTIMENT
The latest evidence favors the bull case. Management has a strong record of executing its strategic plan and has explicitly guided for a strong margin rebound in H2 2026.
BEAR VIEW
The weak Q3 domestic margin guidance of ~7% signals that transition costs are still high and achieving operating leverage on new, higher-quality volume is proving difficult and non-linear.
| Timeline | Event & Metric To Watch |
|---|---|
third and fourth quarters of 2026 | Idled Aircraft Return Watch: Two temporarily idled aircraft are expected to return to operational service. |
Q3 2026 Earnings (Late Oct 2026) | Domestic Leverage Failure Watch: U.S. Domestic operating margin falling short of guidance. Cost per piece growing faster than revenue per piece. |
Q3 2026 Earnings (Late Oct 2026) | Goodwill Impairment Charge Watch: A non-cash impairment charge related to Goodwill in the Supply Chain Solutions segment in the next earnings release. |
11/3/2026 | Negative Peer Read-Through Watch: Peer Expeditors (EXPD) reporting weak volumes, pricing, or guidance, particularly in international freight, on its earnings call. |
12/16/2026 | International Margin Erosion Watch: Peer FedEx (FDX) commentary on international export trends, particularly on Asia and Europe lanes, and fuel cost impacts. |
1/13/2027 | Peer Earnings Report Watch: Peer JB Hunt Transport Services (JBHT) is scheduled to report earnings. |
| Date | Event | Stock Impact |
|---|---|---|
2026-08-31 | Key Executive Retirement Details: The company announced that Kate Gutmann, Executive Vice President and President of International, Healthcare and Supply Chain Solutions, will retire for personal family reasons. | -2.5% $105.33 -> $102.66 |
2026-08-24 | Major Investment Plan Detailed Details: UPS announced ongoing investments of more than $2 billion across its International, Healthcare and Supply Chain Solutions businesses, which began in 2024 and will continue through 2028. | +3.1% $102.01 -> $105.14 |
2026-07-28 | Q2 Earnings and Guidance Raise Details: UPS reported Q2 revenues of $22.8 billion and adjusted EPS of $1.76. The company raised its full-year 2026 revenue guidance by 1.7%. The stock reacted -7.0%. | -7.4% $111.18 -> $102.92 |
2026-06-22 | Healthcare Logistics Investment Details: The company announced a $48 million investment in 27 temperature-controlled freight cross-dock facilities to extend its complex healthcare logistics capabilities. | +0.9% $103.21 -> $104.17 |
2026-05-29 | Announced Mexico Air Expansion Details: UPS announced a nearly $50 million investment in network capabilities for automotive and industrial manufacturers, including a North American air freight expansion in Mexico. | +2.2% $105.00 -> $107.31 |
2026-04-28 | Q1 2026 Earnings Reported Details: UPS announced first-quarter 2026 consolidated revenues of $21.2 billion and non-GAAP adjusted diluted earnings per share of $1.07. The stock reaction was -2.0%. | -1.5% $104.78 -> $103.20 |
Position Sizing
5% - 7%
NORMAL POSITION
Sizing is volatility-based: UPS trades at roughly 25% annualized options-implied volatility versus about 13% for the S&P 500 (1.9x the market), around the 16th percentile of its own trailing year. A 5% - 7% position keeps a single-name swing of that size within a diversified portfolio's risk budget.
Diversification Alternatives
FDX - FedEx
Direct CompetitorFedEx reported higher trailing-twelve-month revenue growth of 7.7% and a superior gross margin of 21.8%, suggesting a different cost structure and recent market share gains.
EXPD - Expeditors International of Washington
Asset-Light ExposureAs a freight forwarder, this company provides exposure to global trade flows with a less capital-intensive business model compared to owning a physical delivery network.
A logistics giant executing a major pivot from a scale-at-all-costs model to a margin-focused strategy by reconfiguring its network and curating a higher-quality customer base.
UPS is in the midst of a significant structural reset, deliberately shedding approximately 2 million pieces per day of lower-margin volume from its largest customer, Amazon. This "glide down" is paired with a network reconfiguration to create a leaner, more automated, and more agile operation. The core thesis is that by focusing on premium segments like SMBs, B2B, and complex healthcare, UPS can build a more profitable business with better operating leverage, even on a smaller volume base. The second half of 2026 is positioned as the inflection point for this strategy to translate into margin expansion.
Sustained operating margin expansion in the U.S. Domestic segment, continued growth in SMB and healthcare revenue, and evidence of operating leverage where revenue grows faster than costs.
Inability to replace the shed Amazon volume with sufficient high-margin business, leading to negative operating leverage and margin compression. Loss of share in targeted premium segments.
Headline year-over-year volume declines that are part of the planned strategic reduction of Amazon volume.
Repricing Catalyst
The successful completion of the Amazon volume reduction in June 2026, setting the stage for management-guided operating margin expansion in the second half of the year.
U.S. Domestic Package
$59.2B TTM (67% of Total) · 6% MarginWhat It Is
This segment provides a full spectrum of U.S. domestic air and ground package transportation services to business (B2B) and residential (B2C) customers, including same-day, next-day, and day-definite ground services.
Who Pays & How
Businesses and consumers pay for time-definite, guaranteed small package delivery within the U.S. They choose UPS for its comprehensive network covering nearly all zip codes, service reliability, and a range of delivery speeds.
Competition
International Package
$18.7B TTM (21% of Total) · 15% MarginWhat It Is
This segment offers a wide selection of guaranteed day- and time-definite international transportation services, including customs brokerage, to customers in over 200 countries and territories across Europe, the Americas, and Asia.
Who Pays & How
Businesses and consumers requiring cross-border shipping pay for reliable international delivery with integrated customs clearance. They choose UPS for its significant global presence and ability to facilitate international trade.
Competition
United Parcel Service — Investor Video Playlist
Industry Resources
| Industrials Resources |
| IndustryWeek |
| Manufacturing.net |
| Aviation Week |
| Air Freight & Logistics Resources |
| Air Cargo World |
| Logistics Management |
| Journal of Commerce (JOC) |
External Quote Links
| Y Finance | Barrons |
| TradingView | Morningstar |
| SeekingAlpha | ValueLine |
| Motley Fool | Robinhood |
| CNBC | Etrade |
| MarketWatch | Unusual Whales |
| YCharts | Perplexity Finance |
| FinViz |
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