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United Parcel Service (UPS) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

United Parcel Service (UPS) closed the most recent trading day at $98.69, moving -0.1% from the previous trading session. This move lagged the S&P 500's daily gain of 1.45%. Meanwhile, the Dow gained 1.22%, and the Nasdaq, a tech-heavy index, added 0.78%.

Heading into today, shares of the package delivery service had gained 12.27% over the past month, outpacing the Transportation sector's loss of 10.38% and the S&P 500's loss of 7.42% in that time.

Wall Street will be looking for positivity from UPS as it approaches its next earnings report date. This is expected to be April 28, 2020. In that report, analysts expect UPS to post earnings of $1.32 per share. This would mark a year-over-year decline of 5.04%. Meanwhile, our latest consensus estimate is calling for revenue of $17.95 billion, up 4.63% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $7.47 per share and revenue of $77.16 billion, which would represent changes of -0.8% and +4.14%, respectively, from the prior year.

Any recent changes to analyst estimates for UPS should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 5.19% lower. UPS is currently sporting a Zacks Rank of #4 (Sell).

Looking at its valuation, UPS is holding a Forward P/E ratio of 13.23. This valuation marks a premium compared to its industry's average Forward P/E of 12.96.

Meanwhile, UPS's PEG ratio is currently 1.72. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. UPS's industry had an average PEG ratio of 1.42 as of yesterday's close.

The Transportation - Air Freight and Cargo industry is part of the Transportation sector. This industry currently has a Zacks Industry Rank of 51, which puts it in the top 20% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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United Parcel Service, Inc. (UPS) : Free Stock Analysis Report
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