UPS (UPS) Stock Forecast & Price Target

United Parcel Service (UPS) is experiencing significant growth in its international package segment, which accounts for 21% of total revenue and has demonstrated a 2.6% year-over-year revenue increase, driven by a 3.9% uplift in average daily volume. Notably, volumes from China to the rest of the world have soared by over 20%, with strong performances also reported from other Southeast Asian markets, indicating a robust demand for UPS services. This growth, coupled with an export increase of 6.1% and strong performance in Canadian volumes, positions UPS for potential long-term margin improvements and positive financial performance.

The analysis indicates a negative outlook on United Parcel Service's stock due to a 13.1% decline in adjusted operating profits, totaling $212 million, which is attributed to margin pressures in forwarding services and increased costs related to Mail Innovations handling. Additionally, the supply chain solutions segment experienced an 18.3% year-over-year revenue decline to approximately $2.7 billion, largely influenced by the divestiture of Coyote in 2024. Furthermore, the Ground Saver volume, the most cost-sensitive component of UPS's portfolio, decreased by 23%, reaching its lowest level in two years, reflecting potential challenges in market demand.