United Parcel Service (UPS) has announced potential disruptions to its pickup and delivery services in the southern U.S., particularly Louisiana, due to Hurricane Francine. The company is implementing contingency plans to minimize delays and ensure shipments reach their destinations as quickly as possible.
The Indian government has introduced a Unified Pension Scheme (UPS) for central government employees, combining features of the Old Pension Scheme and the existing National Pension Scheme. The scheme guarantees a minimum pension and a family pension, with inflation indexing and increased government contributions. It aims to provide a more secure retirement for government employees.
UPS, the $124 billion carrier, has struggled since inflation began to accelerate in early 2021. Data shows UPS is down 10.44% since May 2021, while the S&P 500 has gained 25.75% during the same period. Management’s guidance suggests little to no revenue growth this year, with rising costs and declining shipping volumes. The company’s aggressive capital expenditure plans and reliance on automation fail to address its dependence on unionized labor and the challenges posed by competitors like Amazon. Analysts predict only 4-5% revenue growth for UPS over the next several years, yet the stock trades at a growth multiple of nearly 18x predicted forward GAAP earnings. Given its slowing revenue, declining EPS, and valuation concerns, UPS should not be trading at more than a multiple of 12-14x expected forward earnings.
United Parcel Service, Inc. (UPS) reported disappointing first-quarter results on Tuesday, reflecting a significant slowdown in the shipping industry. Revenue declined by 5.3% year-over-year, while operating profit dropped by 31.5% after adjusting for inflation. The steep decline in operating profit was attributed to recent salary negotiations with the Teamsters, resulting in a $170,000 salary guarantee for delivery truck drivers over the next five years. Despite the overall decline, UPS shares gained 2.4% on Tuesday as quarterly profit exceeded analyst expectations. The company also announced a new contract with the United States Postal Service (USPS) to provide air cargo services, which is expected to contribute to revenue growth and align with UPS’s strategy to expand its B2B business.
UPS reported a resilient first quarter of 2024, with adjusted earnings per share (EPS) and revenue surpassing Wall Street estimates, despite a year-over-year decline. The company’s stock responded positively, rising 2.5%. CEO Carol Tomé cited strong financial performance and improving average daily volume in the U.S. UPS reaffirmed its full-year financial guidance, expecting revenue between $92.0 billion and $94.5 billion.
UPS is scheduled to report its Q1 earnings results on Tuesday, April 23rd, with analysts expecting a decline in both earnings and revenue compared to the same period last year. Investors will be keen to hear the company’s comments on the impact of healthcare logistics and e-commerce returns on its performance. Despite the expected downturn in earnings, analysts remain positive about UPS’ long-term prospects, citing its cyclical nature and focus on efficiency and growth in key areas.
