United Parcel Service Q3 EPS Beats by $0.43 on $21.42B Revenue; Truist, UBS Hike Price Targets
United Parcel Service reported Q3 EPS of $1.74, beating the $1.31 consensus estimate by $0.43 on revenue of $21.42 billion, although revenue fell 3.7% year-over-year. Truist Financial and UBS Group raised their price targets to $120 and $113 respectively after the results, reflecting renewed analyst optimism.
1. Quarterly Earnings Exceed Expectations
In its latest report, United Parcel Service delivered earnings per share of $1.74 for the quarter, surpassing consensus estimates by $0.43. Revenue reached $21.42 billion, topping the projected $20.94 billion and representing a 3.7% year-over-year decline. The company achieved a return on equity of 40.07% and maintained a net margin of 6.15%, underscoring operational efficiency despite volume pressures in the small-package segment.
2. Notable Institutional Accumulation
Econ Financial Services Corp increased its stake in UPS by 118.5%, adding 19,835 shares to bring its total holding to 36,578 shares, valued at approximately $3.06 million and representing 1.5% of the firm’s portfolio. Other institutional moves included a 3.9% boost from Cornerstone Wealth Group LLC to 2,557 shares, a 1.9% lift by Bangor Savings Bank to 5,413 shares, and modest increases by First Dallas Securities Inc., Fortis Capital Advisors LLC and Wright Investors Service Inc. Overall, institutions now control 60.26% of UPS shares outstanding.
3. Analyst Ratings and Consensus Position
Among research firms covering UPS, one has issued a Strong Buy rating, nine carry Buy opinions, sixteen maintain Hold guidance, and four recommend Sell. The average consensus rating sits at Hold, reflecting mixed views on growth prospects. Analysts have cited stable cash flows and dividend yield as positives, while cautioning on margin compression and foreign-exchange headwinds.
4. Dividend Policy and Balance Sheet Strength
UPS declared a quarterly dividend of $1.64 per share, translating to an annualized payout of $6.56 and a yield of 6.6%. The dividend payout ratio stands at 101.39%, signaling a commitment to shareholder returns. The balance sheet features a market capitalization of $84.19 billion, a price-earnings ratio of 15.34, a price-earnings-growth ratio of 2.36 and a debt-to-equity ratio of 1.50. Liquidity metrics include a quick ratio and current ratio both at 1.30, supporting the company’s ability to fund ongoing operations and capital expenditures.