📖 UPS is the worlds largest package delivery company. UPS’ valuation is much higher than FedEx
, buy maybe for good reason. UPS is better at generating profits and generating free cashflow
from its earnings
. UPS has benefited from surging e-commerce volumes in 2020 due to a combination of stay-at-home measures and social-distancing decisions, especially from business to consumer deliveries. However, this has presented margin challenges - for example - the surge in white goods purchased online are bulky and costly to deliver to residential properties. UPS could be poised to continue to benefit from the rise in e-commerce. In addition, the vaccine will help UPS as its delivery networks will play a key role in distributing it. UPS CEO Carol Tome outlined how UPS is expanding its "freezer farm capacity by installing validated freezers that range from negative 20 to negative 80 degrees Celsius" in Kentucky and the Netherlands. UPS is clearly playing a major role in the global distribution of vaccines.
📈 UPS is down 9% from its all time highs. It has been trading in a bullish price channel
since lows in May and experienced a massive gap up in July after better than expected earnings
. Price has been range-bound since August. Price has recently bounced from the support zone
around $155. There is some further resistance from a downward trend line
from highs in December. Should we see price break this, UPS could see a 9% swing back to near all time highs. Median analyst price target is $183, 14% higher of todays levels.
🔎This is not financial advice. Always do your own research and due diligence.