Track market-moving stories before they get noisy

Analysts on Wall Street project that United Parcel Service (UPS - Free Report) will announce quarterly earnings of $1.63 per share in its forthcoming report, representing a decline of 6.3% year over year. Revenues are projected to reach $22.23 billion, increasing 3.8% from the same quarter last year.

The consensus EPS estimate for the quarter has undergone an upward revision of 0.1% in the past 30 days, bringing it to its present level. This represents how the covering analysts, as a whole, have reassessed their initial estimates during this timeframe.

Prior to a company's earnings release, it is of utmost importance to factor in any revisions made to the earnings projections. These revisions serve as a critical gauge for predicting potential investor behaviors with respect to the stock. Empirical studies consistently reveal a strong link between trends in earnings estimate revisions and the short-term price performance of a stock.

While investors usually depend on consensus earnings and revenue estimates to assess the business performance for the quarter, delving into analysts' forecasts for certain key metrics often provides a more comprehensive understanding.

Bearing this in mind, let's now explore the average estimates of specific UPS metrics that are commonly monitored and projected by Wall Street analysts.

The combined assessment of analysts suggests that 'Revenue- International Package- Cargo and other' will likely reach $194.75 million. The estimate points to a change of +8.2% from the year-ago quarter.

It is projected by analysts that the 'Revenue- U.S. Domestic Package- Ground' will reach $10.59 billion. The estimate points to a change of +0.7% from the year-ago quarter.

The average prediction of analysts places 'Revenue- U.S. Domestic Package- Cargo and Other [$M]' at $318.76 million. The estimate indicates a change of +8.4% from the prior-year quarter.

According to the collective judgment of analysts, 'Revenue- U.S. Domestic Package' should come in at $14.48 billion. The estimate suggests a change of +1.8% year over year.

Analysts expect 'Average revenue per piece - Total' to come in at $16.01 . Compared to the present estimate, the company reported $14.82 in the same quarter last year.

The consensus among analysts is that 'Average revenue per piece - International Package - Total' will reach $23.80 . Compared to the current estimate, the company reported $21.48 in the same quarter of the previous year.

The consensus estimate for 'Average daily package volume - International Package - Export' stands at 1.66 million. The estimate is in contrast to the year-ago figure of 1.73 million.

Analysts' assessment points toward 'Average revenue per piece - U.S. Domestic Package - Ground' reaching $12.45 . The estimate is in contrast to the year-ago figure of $11.81 .

Analysts forecast 'Average revenue per piece - U.S. Domestic Package - Total' to reach $14.44 . Compared to the present estimate, the company reported $13.47 in the same quarter last year.

Analysts predict that the 'Average revenue per piece - International Package - Domestic' will reach $9.47 . The estimate compares to the year-ago value of $8.62 .

The collective assessment of analysts points to an estimated 'Average revenue per piece - International Package - Export' of $36.15 . The estimate compares to the year-ago value of $32.87 .

Based on the collective assessment of analysts, 'Average daily package volume - International Package - Total' should arrive at 3.10 million. The estimate is in contrast to the year-ago figure of 3.27 million.

View all Key Company Metrics for UPS here>>>

Over the past month, shares of UPS have returned +3.9% versus the Zacks S&P 500 composite's no change. Currently, UPS carries a Zacks Rank #3 (Hold), suggesting that its performance may align with the overall market in the near future. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .

A 30-year Teamster pension and a paid-off Texas house sounds bulletproof until the appraisal district mails its notice every spring and starts quietly repricing everything a fixed check has to cover.

A full-time UPS (NYSE:UPS | UPS Price Prediction) Teamster with 30 years in the IBT-UPS pension and a paid-off house in Texas looks as solid on paper as almost any blue-collar retirement. Under the 2023 contract, the 30-at-55 pension will be $4,800 a month, and Texas has no state income tax. The variable is how far that check goes once the appraisal district’s notice arrives each spring. Texas taxes the house, so the county’s opinion of the home’s value sets the budget.

The model below shows what a married couple, both 65, with no mortgage on a home appraised at $350,000, would get. Let’s assume the driver gets the 30-year pension, and the couple collects Social Security at the SSA’s average for couples their age, $3,355 a month after the 3.6% COLA for 2027.

What $97,860 a Year Has to Cover in Texas Together, the pension and Social Security bring in $97,860 a year. Here is the working budget:

Line item Annual cost Property tax (school plus city/county) $5,700 Homeowners insurance $3,489 Medicare Part B, two people $4,870 Medigap and Part D, two people $5,000 Federal income tax $4,800 Food $9,600 Utilities $4,800 Transportation and vehicle replacement $8,000 Home maintenance reserve $3,500 Travel, gifts, personal $12,000 Emergency reserve $3,000 Total $64,759 Most Texas homeowners pay a combined rate of 2% to 2.5% on their homes. The model uses 2.2%, with 1.0% going to the school district and 1.2% to the city and county. School districts exempt $140,000 of every homestead’s value and add a $60,000 exemption at age 65. That leaves $1,500 in school tax and $4,200 for the city and county.

Part B costs $202.90 per person per month. Because a couple both age 65 can deduct $47,500, the federal bill on the pension plus 85% of taxable Social Security comes to about $4,800. The couple ends up with a $33,101 annual surplus, and everything else in this plan draws on that cushion.

How the Appraisal Notice Reprices the Budget Every Spring Once the over-65 exemption is filed, a school district may not increase the total annual amount of ad valorem tax above the first year the homestead qualified (Tex. Tax Code § 11.26(a)). A city or county ceiling exists only if that taxing unit has established one. So the larger, non-school share of the bill continues to rise with appraisals, up to 10% a year (§ 23.23(a)).

That cap limits each year’s increase measured from the prior appraisal. After a price run-up, appraised value continues climbing toward market value even when prices go flat, and national home values increased 1.9% over the past year. Five straight 10% increases push the $4,200 city and county bill to about $6,760.

Owners 65 and older can defer the tax entirely under § 33.06(a), but interest accrues at 5% per year, and the balance comes due after the owner leaves the home. A 1-year Treasury currently pays 4.51%. Deferral serves as a backstop, and the heirs’ equity covers the cost.

Where a Fixed Pension Runs Out of Room The plan summary will say whether the pension has a cost-of-living adjustment. If it doesn’t, 3% inflation means $57,600 buys what about $42,860 buys today after ten years. Add the property tax creep, and the couple’s margin narrows to roughly $15,800.

The survivor case is tighter. The average widow or widower living alone gets $2,005 a month. Assume a full survivor pension and the same budget, and by year ten the margin is about negative $400. If the driver took a single-life pension to get the larger check, the survivor loses the pension completely.

Retiring at 55 changes the math more than anything else. Without Social Security, Medicare, or the school tax freeze, the pension still covers everything except health insurance, with about $4,400 left over. Every additional $10,000 in annual premiums requires roughly $100,000 in Treasuries to bridge the ten years, with yields of 4.79% at two years and 4.94% at five. Taking Social Security at 62 permanently cuts the benefit. Waiting raises both the household check and the survivor check.

What It Actually Takes to Make the Pension Hold At 65, a 30-year IBT-UPS pension plus average Social Security fully covers a mortgage-free Texas budget of about $65,000, with no portfolio needed. The weak points are inflation and widowhood. A reserve of about $150,000 in index funds and short Treasuries, at 4%, provides $6,000 a year to cover the survivor gap and rising appraisals. A driver who leaves at 55 needs that reserve plus the health insurance bridge.

Electing a joint-and-survivor pension and filing the over-65 exemption in the first eligible year protect the plan more than investment returns do. The freeze applies only to school taxes. The city and county share is the part of the bill that continues growing for decades.

Contact [email protected] for any questions or corrections.

In the latest close session, United Parcel Service (UPS - Free Report) was up +1.09% at $98.52. The stock's performance was ahead of the S&P 500's daily gain of 0.28%. Elsewhere, the Dow gained 1.02%, while the tech-heavy Nasdaq lost 0.02%.

The stock of package delivery service has risen by 2.86% in the past month, leading the Transportation sector's loss of 1.81% and the S&P 500's gain of 0.67%.

Market participants will be closely following the financial results of United Parcel Service in its upcoming release. The company plans to announce its earnings on October 27, 2026. In that report, analysts expect United Parcel Service to post earnings of $1.63 per share. This would mark a year-over-year decline of 6.32%. Our most recent consensus estimate is calling for quarterly revenue of $22.23 billion, up 3.8% from the year-ago period.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $7.19 per share and a revenue of $91.71 billion, representing changes of +0.42% and +3.44%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for United Parcel Service. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.25% lower within the past month. Currently, United Parcel Service is carrying a Zacks Rank of #3 (Hold).

Looking at its valuation, United Parcel Service is holding a Forward P/E ratio of 13.56. Its industry sports an average Forward P/E of 15.56, so one might conclude that United Parcel Service is trading at a discount comparatively.

Meanwhile, UPS's PEG ratio is currently 1.8. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Transportation - Air Freight and Cargo was holding an average PEG ratio of 1.5 at yesterday's closing price.

The Transportation - Air Freight and Cargo industry is part of the Transportation sector. This group has a Zacks Industry Rank of 41, putting it in the top 17% of all 250+ industries.

The Zacks Industry Rank is ordered 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.

You can find more information on all of these metrics, and much more, on Zacks.com.

Since it is election season, voters and investors who closely monitor the intersection of financial markets and politics are being inundated with political prognostications often conveyed in "leans/likely/D/R" form.

Essentially, those predictions are pundits' way of saying that a particular result is likely to occur in a specific electoral contest. Sometimes, "probably" is as good as it gets, and that's relevant when addressing the often-discussed fate of the UPS (UPS -0.02%) dividend.

UPS's dividend is probably going to get through 2027, but that's not a "buy" signal. Image source: Getty Images.

It's not a stretch to say that the most-discussed items related to UPS stock are the fate of the payout, the 6.7% yield (as of Friday, Oct. 16), and the company's decision to move away from high-volume, low-margin Amazon deliveries.

So, with transportation and logistics already freezing payouts earlier this year, halting a 16-year streak of dividend increases, investors want clarity and definition. Barring a definitive announcement on the dividend from UPS, "probably" carries the day, which is to say the payout will likely remain frozen for the remainder of 2026 and 2027. That doesn't make the stock a "buy."

Surviving isn't the same as thriving An admittedly intangible factor may be a sign that UPS' dividend survives through 2027. That factor is competition. Smart management teams at dividend-paying companies know there's competition for investors' cash and that dividends, particularly the safe, growing variety, are a source of attraction for that capital.

With 10- and 30-year Treasury yields both north of 5% and those bonds likely offering significantly less risk than UPS shares, a dividend cut or suspension by the industrial company could easily spark a swift sell-off.

UPS and its dividend aren't just competing with bonds. Consider the Dividend Aristocrats® (the term Dividend Aristocrats® is a registered trademark of Standard & Poor's Financial Services LLC), which are the S&P 500 companies with a minimum payout increase streak of 25 years. More than 21% of those stocks hail from the industrial sector. So if UPS becomes a dividend offender, investors have plenty of options in the same sector to transition to.

UPS United Parcel Service$97.46-$0.02 (-0.02%)

NYSE · As of 4:00 PM ET 10/19/26

Combine Treasury yields and the abundance of other, more reliable dividend growth options in the industrial sector, which are factors likely not lost on UPS management, and the package delivery giant may be compelled/obligated not to embrace negative action next year. Yes, that's not surviving, but no, it isn't thriving, either.

UPS dividend safety is questionable Just as surviving and thriving aren't the same, surviving and being safe are also two very different things. In 2025, UPS generated $5.47 billion in free cash flow, with $5.4 billion of that sum directed to covering the dividend. The problem is that the figure is projected to fall to $5.05 billion this year and $5.01 billion in 2027, implying that the company is increasingly burdened by its dividend obligations.

That doesn't mean a cut or suspension is imminent, but those numbers don't scream "dividend safety." Nor does an estimate of the dividend sapping 98% of 2026 free cash flow.

Risk-tolerant investors mulling positions in UPS ought to consider history. From 2007 through mid-2025, 60% of dividend cutters came from the group of stocks with the highest payout ratios, and a quarter of those names were in both the highest payout ratio and highest dividend yield groups. As of Friday, Oct. 16, just 10 members of the S&P 500 sported dividend yields north of 6%. UPS is one.

To top it all off, UPS is contending with headwinds from rising competition and high fuel prices, potentially setting the stage for disappointing quarterly results. So while UPS' dividend may make it through 2027 unscathed, investors can find more safety with less stress in the industrial sector, and that may be the course of action to take.

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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

United Parcel Service (UPS - Free Report) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.

Shares of this package delivery service have returned -3% over the past month versus the Zacks S&P 500 composite's +2.1% change. The Zacks Transportation - Air Freight and Cargo industry, to which UPS belongs, has lost 6.5% over this period. Now the key question is: Where could the stock be headed in the near term?

While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.

Revisions to Earnings EstimatesHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.

We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For the current quarter, UPS is expected to post earnings of $1.63 per share, indicating a change of -6.3% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.1% over the last 30 days.

For the current fiscal year, the consensus earnings estimate of $7.19 points to a change of +0.4% from the prior year. Over the last 30 days, this estimate has changed -0.4%.

For the next fiscal year, the consensus earnings estimate of $7.97 indicates a change of +10.8% from what UPS is expected to report a year ago. Over the past month, the estimate has changed -0.1%.

With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for UPS.

Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.

In the case of UPS, the consensus sales estimate of $22.22 billion for the current quarter points to a year-over-year change of +3.8%. The $91.71 billion and $95.15 billion estimates for the current and next fiscal years indicate changes of +3.4% and +3.8%, respectively.

Last Reported Results and Surprise HistoryUPS reported revenues of $22.83 billion in the last reported quarter, representing a year-over-year change of +7.6%. EPS of $1.76 for the same period compares with $1.55 a year ago.

Compared to the Zacks Consensus Estimate of $21.75 billion, the reported revenues represent a surprise of +4.98%. The EPS surprise was +6.67%.

The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.

ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.

Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.

As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

UPS is graded B on this front, indicating that it is trading at a discount to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about UPS. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

There's no such thing as a free lunch, and there's no such thing as a blue chip stock like UPS (UPS +1.04%) yielding 7% without containing a significant amount of risk.

Quite clearly, the market is concerned with the sustainability of the dividend and rightly so, not least as there are reasons to suspect the company could miss its earnings expectations in the quarter and for 2026. Still, even in that case, UPS stock might be a good value.

Why UPS might miss estimates
The doubt around its earnings comes down to three main factors:

Ongoing elevated fuel costs could pressure profit margins at a company that has raised fuel surcharges over and above its fuel cost increases over the last year or so.
Potential competition from Amazon (AMZN -1.74%) could negatively impact UPS's volume or pricing.
Global e-commerce trends don't appear to be favorable to UPS right now.

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Fuel surcharges, Amazon, and delivery volumes
I previously discussed how UPS raised fuel surcharges by a combined $1.173 billion in the first half of 2026, compared to a combined increase in fuel costs and third-party fuel of $744 million, resulting in a net difference of $429 million.

There are other operating costs associated with fuel supply disruptions, so it's probably unfair to argue that the $429 million drops down into the profit line. Still, it's a large number, and given the ongoing high fuel costs, UPS could struggle to pass through fuel surcharges without taking a hit to volume.

Amazon Supply Chain Services was only launched this year, so it might be a bit premature to expect a direct impact on UPS volumes. However, if Amazon is pricing aggressively to win small and medium-sized business (SMB) deliveries from customers it already has in its Amazon marketplace, UPS could increase pricing in one of its core end markets in the U.S.

Image source: Getty Images.

Finally, UPS's recent Global Freight Transportation and Logistics Trends report for the third quarter noted, "While AI-driven demand continued to support the air freight sector, e-commerce demand declined 7% YOY in May 2026, marking its sixth consecutive month of contraction."

The AI-driven demand is probably good news for UPS's premium international and supply chain businesses. Still, the weakness in e-commerce deliveries (partly driven by tariff actions that have made Chinese imports uncompetitive) is not.

Why UPS might still be a good value
Don't be surprised if UPS misses earnings estimates in the third quarter. Moreover, its already lightly covered dividend (Wall Street expects $7.20 in earnings per share in 2026, with the dividend per share $6.56) might even come under threat. That said, Delta Air Lines recently missed estimates and cut full-year guidance due to higher fuel expense expectations, and the stock's modest decline suggests the market was somewhat braced for it.

That might also be the case for UPS. If so, it sets the stock up for a recovery if UPS can merely meet expectations and maintain its dividend. My view is that it won't, and it might make sense to wait for the earnings report first before considering buying the stock.

ATLANTA--(BUSINESS WIRE)---- $ups #upsnews--United Parcel Service (NYSE:UPS) will announce its 2026 third-quarter results on October 27, 2026, at approximately 6:00 a.m. Eastern Time. At 8:30 a.m. ET, UPS Chief Executive Officer Carol Tomé and Chief Financial Officer Brian Dykes will lead an investor conference call to discuss the results. This call will be open to the public via a live webcast. To listen, visit the UPS Investor Relations page and click on “Webcast.” The webcast audio will be accessible on the I.

Loading trucks four hours a night at 63 sounds like a step backward, but for someone sitting on $900,000 in a traditional 401(k) with two years until Medicare, it might be the most profitable financial move available.

One of these five blue chips has sent shareholders a dividend check every single quarter since 1916, and that kind of staying power changes how you think about building retirement income from scratch.

Retirement income depends on one question above all: will the check keep coming? The five blue chips below share one answer. Each is a large, cash-generative business with decades of dividend history, and IBM (NYSE:IBM | IBM Price Prediction) has paid a quarterly dividend every year since 1916. Each pick below starts with dividend safety, then yield. Each also comes with one real risk that income investors should consider.

Exxon Mobil: A Fortress Balance Sheet Funding Decades of Raises Exxon Mobil (NYSE:XOM) pays $1.03 per share quarterly, or $4.12 annualized. At a recent $170.02, that works out to a forward yield of about 2.42%.

Dividend safety: This is the safest payout on the list. The forward dividend uses roughly 53% of trailing EPS of $7.77. The balance sheet shows a debt-to-equity ratio of just 0.17, and interest coverage is 56.28x. In the second quarter alone, Exxon generated more than $17 billion of free cash flow, cut net debt by more than $7 billion, and returned more than $9 billion through dividends and buybacks. The company had raised its annual dividend per share for 43 consecutive years as of its Q4 2025 release. It then lifted the quarterly rate from $0.99 to $1.03, starting with the February 12, 2026 ex-dividend date.

Bull case: Guyana is turning into a cash machine. Exxon has fully recovered the $55 billion of investment it put into the project, nearly two years earlier than anticipated. CFO Neil Hansen expects the project to generate “two times the level of free cash flow in 2030 than we saw in 2025.” Cumulative structural cost savings have reached $16.3 billion since 2019, and the 2026 buyback plan is $20B.

Risk: Much of the good news is already in the price. Shares are up 44.09% year to date and sit close to a 52-week high of $174.09. The average analyst target is $173.64. Earnings also still swing with oil prices and geopolitics. Middle East disruption caused what management described as “the temporary loss of approximately 10% of our upstream production” in the second quarter.

Coca-Cola: Raised Guidance Backs a Steadily Rising Dividend Shareholders of Coca-Cola (NYSE:KO) receive $0.53 per quarter, or $2.12 annualized. At $88.12, that is a forward yield of about 2.41%.

Dividend safety: The forward dividend uses roughly 64% of trailing EPS of $3.33. Management is guiding to free cash flow of about $12.4B for 2026. Net debt leverage is 1.4 times EBITDA, below the company’s own target range of 2 to 2.5 times. The quarterly rate has risen in every year of the record from $0.28 in 2013 to $0.53 in 2026. Back in 1999, it was $0.16.

Bull case: Coca-Cola keeps growing. Second-quarter adjusted EPS of $0.97 beat the $0.93 estimate, and revenue rose 6.7% to $13.38B. Volume for the main Coca-Cola brand grew 5%, its best in 17 years outside the COVID rebound. Management now expects comparable EPS growth of 9 to 10%. Coca-Cola stock also moves far less than the overall market (a beta of 0.318), which fits retired people who would rather not watch their income stocks swing.

Risk: You pay up for that stability. Shares are up 28.51% year to date and trade at about 25 times forward earnings. A long-running tax dispute with the IRS is also still open at the 11th Circuit Court of Appeals, and management says the timing of a decision is unknown.

IBM: A Dividend Paid Since 1916 With Free Cash Flow to Spare IBM pays $1.69 quarterly, or $6.76 annualized. At $226.35, that is a forward yield of about 2.99%.

Dividend safety: The forward dividend uses roughly 60% of trailing EPS of $11.21. Free cash flow covers it easily: IBM generated $4.8 billion of free cash flow through the first half of 2026 and paid $3.2 billion in dividends. Free cash flow is also expected to grow by about $1 billion in 2026. The balance sheet is the weak spot. IBM holds $8.2 billion in cash against $62 billion of total debt, although $13 billion of that debt funds its financing business. The raise to $1.69 marked IBM’s 31st consecutive year of dividend increases.

Bull case: Software now makes up nearly 45% of revenue, and about 80% of software revenue is recurring. Annual recurring revenue reached $24.6 billion, up 8%, and Red Hat growth sped up to 11%. Shares are down 22.03% year to date, which drives the yield higher. The stock now trades at about 17 times forward earnings. CFO Jim Kavanaugh called free cash flow “one of the two key leading indicators of our financial investment thesis.”

Risk: Second-quarter operating EPS of $2.93 missed the $2.97 estimate. Some large deals slipped, and infrastructure revenue fell 7.4%. The increases are also small: the quarterly dividend went from $1.67 in 2024 to $1.68 in 2025 and $1.69 in 2026. IBM offers reliability, but the income will just grow.

PepsiCo: A Higher Yield Priced for North American Trouble PepsiCo (NASDAQ:PEP) pays $1.48 quarterly, or $5.92 annualized. At $126.02, that is a forward yield of about 4.70%, the highest on this list after UPS.

Dividend safety: Coverage is adequate but getting tighter. The forward dividend uses roughly 75% of trailing EPS of $7.91. Free cash flow covers the dividend with little room to spare. Measured on the same share price, the free-cash-flow yield of 4.38% sits just above the dividend yield of 4.36%. PepsiCo expects to pay $7.9B in dividends in 2026, plus $1.0B in buybacks. Interest coverage of 12.03x leaves room on the debt side. Increases continue: the quarterly payout went from $1.355 in 2024 to $1.4225 in 2025 and $1.48 in 2026.

Bull case: Overseas growth is carrying the company. Third-quarter results reported October 8, 2026 showed adjusted EPS of $2.34, beating the $2.30 estimate, on revenue of $25.27B. Growth abroad was best: EMEA rose 9%, Asia Pacific 9%, and Latin America Foods 14%. With shares down 9.52% year to date, the stock trades at about 15 times forward earnings.

Risk: North American snacks are the problem. Core operating profit in that unit fell 12%, and full-year core EPS growth guidance was cut to 2.5-3.5%. On the company’s second-quarter call, CEO Ramon Laguarta said “the consumer is worse than what we had anticipated and driven mainly by gas prices.” If earnings keep slowing down, dividend increases will likely get smaller.

United Parcel Service: An Ultra-High-Yield Payout With the Thinnest Cushion United Parcel Service (NYSE:UPS) pays $1.64 quarterly, or $6.56 annualized. At $94.45, that is a forward yield of about 6.95%. This stock stands out as the only ultra-high-yield name on this list.

Dividend safety: UPS has the least room for error of the five. Management plans to pay around $5.4 billion in 2026 dividends, while free cash flow is expected to be approximately $5.5 billion, and that free cash flow figure already includes one-time buyout payments to leaving drivers. The $6.56 payout matches about 91% of guided adjusted EPS of $7.22. It is also higher than trailing GAAP EPS of $5.33. On the positive side, UPS ended the quarter with $4.7 billion in cash and no commercial paper outstanding. The quarterly dividend rose from $0.47 in 2010 to $1.63 in 2024. It has stayed at $1.64 for every payment in 2025 and so far in 2026.

Bull case: UPS has wrapped up its planned reduction in lower-margin Amazon volume, and the numbers are starting to improve. Second-quarter adjusted EPS of $1.76 beat the $1.66 estimate. Revenue per piece rose 11.3% to $15.96. 68.5% of U.S. volume now flows through automated buildings. The restructuring is expected to deliver about $3 billion in benefits this year. The stock trades at about 12 times forward earnings. Management told investors: “We are still planning to pay out around $5.4 billion in dividends in 2026, subject to Board approval.”

Risk: GAAP second-quarter EPS was only $0.71 after $1.17B of transformation costs, and shares are down 34.82% over five years. The next Teamsters contract renewal is two years out. UPS carries more payout risk than any other stock here, which limits its role to a yield booster in a retirement portfolio.

One Income Plan, Five Sources of Cash Exxon Mobil, Coca-Cola and IBM are the core: payouts covered by earnings and free cash flow, supported by long dividend records. PepsiCo adds a higher yield at a lower valuation while its North American business works through a rough patch. UPS adds a near-7% yield that depends on its turnaround delivering in 2026. Together, they give retired people regular checks from five different businesses: energy, drinks, snacks, software and shipping.

Contact [email protected] for any questions or corrections.

Wealth Enhancement Trust Services Inc. increased its holdings in shares of United Parcel Service, Inc. (NYSE:UPS – Free Report) by 802.1% in the 3rd quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC). The firm owned 7,857 shares of the transportation company’s stock after purchasing an additional 6,986 shares during the period. Wealth Enhancement Trust Services Inc.’s holdings in United Parcel Service were worth $734,000 at the end of the most recent quarter.

Other hedge funds have also added to or reduced their stakes in the company. Victory Capital Management Inc. grew its position in shares of United Parcel Service by 72.9% during the 4th quarter. Victory Capital Management Inc. now owns 13,818,314 shares of the transportation company’s stock worth $1,370,639,000 after buying an additional 5,826,824 shares during the period. Pacer Advisors Inc. increased its stake in shares of United Parcel Service by 507.8% in the 4th quarter. Pacer Advisors Inc. now owns 3,244,234 shares of the transportation company’s stock valued at $321,796,000 after acquiring an additional 2,710,470 shares in the last quarter. Wellington Management Group LLP lifted its position in shares of United Parcel Service by 262.7% during the 2nd quarter. Wellington Management Group LLP now owns 3,046,707 shares of the transportation company’s stock valued at $327,521,000 after acquiring an additional 2,206,666 shares during the period. Bank of America Corp DE lifted its position in shares of United Parcel Service by 23.3% during the 1st quarter. Bank of America Corp DE now owns 9,728,123 shares of the transportation company’s stock valued at $957,053,000 after acquiring an additional 1,836,651 shares during the period. Finally, Manning & Napier Advisors LLC acquired a new position in shares of United Parcel Service during the 2nd quarter valued at $192,304,000. 60.26% of the stock is currently owned by institutional investors.

Analysts Set New Price Targets Several brokerages recently issued reports on UPS. UBS Group increased their target price on shares of United Parcel Service from $123.00 to $124.00 and gave the stock a “buy” rating in a research note on Wednesday, July 29th. Sanford C. Bernstein reaffirmed a “buy” rating on shares of United Parcel Service in a research note on Monday, August 24th. The Goldman Sachs Group upped their price objective on shares of United Parcel Service from $128.00 to $132.00 and gave the company a “buy” rating in a report on Wednesday, July 29th. JPMorgan Chase & Co. cut their price objective on shares of United Parcel Service from $118.00 to $115.00 and set a “neutral” rating on the stock in a research report on Wednesday, July 29th. Finally, Raymond James Financial raised their target price on United Parcel Service from $127.00 to $131.00 and gave the company a “strong-buy” rating in a research note on Wednesday, July 29th. One investment analyst has rated the stock with a Strong Buy rating, eleven have issued a Buy rating, eleven have given a Hold rating and three have issued a Sell rating to the stock. Based on data from MarketBeat, United Parcel Service presently has an average rating of “Hold” and a consensus target price of $115.87.

Read Our Latest Stock Analysis on United Parcel Service United Parcel Service Stock Performance NYSE UPS opened at $92.28 on Thursday. The company has a fifty day simple moving average of $100.80 and a 200 day simple moving average of $103.66. United Parcel Service, Inc. has a 12-month low of $82.00 and a 12-month high of $122.41. The company has a current ratio of 1.18, a quick ratio of 1.18 and a debt-to-equity ratio of 1.58. The company has a market cap of $78.51 billion, a P/E ratio of 17.15, a PEG ratio of 1.71 and a beta of 1.07.

United Parcel Service (NYSE:UPS – Get Free Report) last announced its quarterly earnings results on Tuesday, July 28th. The transportation company reported $1.76 EPS for the quarter, beating analysts’ consensus estimates of $1.65 by $0.11. United Parcel Service had a net margin of 5.08% and a return on equity of 37.50%. The business had revenue of $22.83 billion during the quarter, compared to analyst estimates of $21.86 billion. During the same quarter in the previous year, the business posted $1.55 EPS. United Parcel Service’s quarterly revenue was up 7.6% on a year-over-year basis. United Parcel Service has set its FY 2026 guidance at 7.220-7.220 EPS. Sell-side analysts predict that United Parcel Service, Inc. will post 7.22 earnings per share for the current fiscal year.

United Parcel Service Dividend Announcement The firm also recently announced a quarterly dividend, which was paid on Thursday, September 3rd. Investors of record on Monday, August 17th were issued a $1.64 dividend. This represents a $6.56 dividend on an annualized basis and a dividend yield of 7.1%. The ex-dividend date was Monday, August 17th. United Parcel Service’s dividend payout ratio is currently 121.93%.

United Parcel Service News Summary Here are the key news stories impacting United Parcel Service this week:

Positive Sentiment: Citigroup maintained a Buy rating while lowering its price target from $132 to $122, implying substantial upside from recent levels. Citi analyst Ariel Rosa reportedly sees value in parcel-shipping stocks entering the holiday season. Citigroup Adjusts Price Target on United Parcel Service Positive Sentiment: UPS is preparing for peak demand by hiring approximately 100,000 seasonal workers and expanding shipment tracking, package-protection and delivery options. The initiatives could support service reliability, customer retention and holiday volumes. UPS Scales Seasonal Workforce Positive Sentiment: UPS Secure Commerce combines insurance, high-value shipment protection and risk-monitoring tools, creating a potential source of higher-value logistics revenue and differentiation. Some commentary estimates the stock could be about 20% undervalued. UPS Could Be 20% Undervalued Neutral Sentiment: Truist also retained a Buy rating but reduced its target from $130 to $115, signaling continued long-term confidence while reflecting more cautious near-term expectations. Truist Lowers UPS Price Target Negative Sentiment: The target cuts from both Citi and Truist weigh on sentiment, while commentary questioning whether cash flow adequately covers UPS’s high dividend raises income-investor risk. Seasonal hiring is also below the 110,000 workers hired in 2025 and 125,000 in 2024, consistent with ongoing workforce and facility reductions. UPS Dividend Yield Concerns (Free Report)

United Parcel Service, Inc (NYSE: UPS) is a global logistics and package delivery company that provides transportation and supply chain management services to businesses and consumers. Its operations include the pickup, transportation and delivery of packages, documents and freight through ground, air and international networks.

UPS also offers logistics and supply chain solutions, including warehousing, distribution, customs brokerage, contract logistics, returns management and specialized services for healthcare and other industries.

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ATLANTA--(BUSINESS WIRE)---- $ups #upsnews--UPS (NYSE: UPS) is entering the busy 2026 holiday shipping season with expanded shipping options. From helping customers precisely track their shipments to enhanced package protection, customers benefit from the reliability and flexibility of UPS's industry leading end-to-end logistics network. A key part of reliable service is UPS's RFID-powered tracking technology, which offers more precise, real-time tracking information as packages move through the network. UPS exp.

Have you been searching for a stock that might be well-positioned to maintain its earnings-beat streak in its upcoming report? It is worth considering United Parcel Service (UPS - Free Report) , which belongs to the Zacks Transportation - Air Freight and Cargo industry.

This package delivery service has seen a nice streak of beating earnings estimates, especially when looking at the previous two reports. The average surprise for the last two quarters was 4.78%.

For the last reported quarter, UPS came out with earnings of $1.76 per share versus the Zacks Consensus Estimate of $1.65 per share, representing a surprise of 6.67%. For the previous quarter, the company was expected to post earnings of $1.04 per share and it actually produced earnings of $1.07 per share, delivering a surprise of 2.88%.

Price and EPS Surprise

With this earnings history in mind, recent estimates have been moving higher for UPS. In fact, the Zacks Earnings ESP (Expected Surprise Prediction) for the company is positive, which is a great sign of an earnings beat, especially when you combine this metric with its nice Zacks Rank.

Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven.

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.

UPS currently has an Earnings ESP of +1.45%, which suggests that analysts have recently become bullish on the company's earnings prospects. This positive Earnings ESP when combined with the stock's Zacks Rank #3 (Hold) indicates that another beat is possibly around the corner. We expect the company's next earnings report to be released on October 27, 2026.

With the Earnings ESP metric, it's important to note that a negative value reduces its predictive power; however, a negative Earnings ESP does not indicate an earnings miss.

Many companies end up beating the consensus EPS estimate, though this is not the only reason why their shares gain. Additionally, some stocks may remain stable even if they end up missing the consensus estimate.

Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

Key Takeaways UPS is combining InsureShield, Parcel Pro & CommerceShield to manage risks surrounding an order. Data, technology and agentic AI aim to identify shipment loss and fraud risks earlier. Buru cut claims processing from 20-25 minutes to a few minutes with faster claim resolution. United Parcel Service’s (UPS - Free Report) launch of UPS Secure Commerce reflects the expansion of supply chain management beyond transportation and delivery into risk management, fraud prevention and customer experience. By combining InsureShield, Parcel Pro and CommerceShield, UPS is positioning its services as an integrated approach to protecting shipments, revenues and customer relationships.

A notable aspect of the announcement is the emphasis on proactive, data-driven risk management. Rather than addressing shipment loss, fraud or delivery problems only after they occur, United Parcel aims to use its logistics data, technology and agentic AI to identify potential risks earlier. This could be particularly valuable for e-commerce businesses dealing with increasingly complex, multi-carrier supply chains.

The customer example from Buru also highlights the potential operational benefits. Reducing claims processing time from 20-25 minutes to just a few minutes and resolving claims more quickly could help businesses improve efficiency while responding to customers faster. However, the platform’s broader effectiveness will ultimately depend on factors such as implementation costs, data integration, accuracy of risk detection, and how well these solutions work across different carriers and business models.

Overall, UPS Secure Commerce signals a broader shift in logistics from simply moving and protecting packages to managing the entire commercial risk surrounding an order. As e-commerce continues to grow, tools that combine visibility, insurance, fraud mitigation and automation could become increasingly important for businesses seeking to reduce losses while maintaining customer trust.

United Parcel’s Share Price PerformanceUPS’ shares have gained 4.9% over the past six months compared with the Transportation - Air Freight and Cargo industry’s 12.9% growth.

Image Source: Zacks Investment Research

UPS’s Zacks RankUPS currently carries a Zacks Rank #3 (Hold).

Stocks to ConsiderInvestors interested in the Zacks Transportation sector may consider better-ranked stocks like Expeditors International of Washington, Inc. (EXPD - Free Report) and Herc Holdings (HRI - Free Report) .

Expeditors currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

EXPD has an expected earnings growth rate of 28.6% for 2026. The company has an encouraging earnings surprise history. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 17.15%.

Herc Holdings currently sports a Zacks Rank #1.

HRI has a negative expected earnings growth rate of 8.4% for the current year. However, the company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 60.64%.

Quarterly financial reports play a vital role on Wall Street, as they help investors see how a company has performed and what might be coming down the road in the near-term. And out of all of the metrics and results to consider, earnings is one of the most important.

We know earnings results are vital, but how a company performs compared to bottom line expectations can be even more important when it comes to stock prices, especially in the near-term. This means that investors might want to take advantage of these earnings surprises.

Hunting for 'earnings whispers' or companies poised to beat their quarterly earnings estimates is a somewhat common practice. But that doesn't make it easy. One way that has been proven to work is by using the Zacks Earnings ESP tool.

The Zacks Earnings ESP, ExplainedThe Zacks Earnings ESP, or Expected Surprise Prediction, aims to find earnings surprises by focusing on the most recent analyst revisions. The basic premise is that if an analyst reevaluates their earnings estimate ahead of an earnings release, it means they likely have new information that could possibly be more accurate.

With this in mind, the Expected Surprise Prediction compares the Most Accurate Estimate (being the most recent) against the overall Zacks Consensus Estimate. The percentage difference provides the ESP figure. The system also utilizes our core Zacks Rank to provide a stronger system for identifying stocks that might beat their next quarterly earnings estimate and possibly see the stock price climb.

When we join a positive earnings ESP with a Zacks Rank #3 (Hold) or stronger, stocks posted a positive bottom-line surprise 70% of the time. Plus, this system saw investors produce roughly 28% annual returns on average, according to our 10 year backtest.

Most stocks, about 60%, fall into the #3 (Hold) category, and they are expected to perform in-line with the broader market. Stocks with a #2 (Buy) and #1 (Strong Buy) rating, or the top 15% and top 5% of stocks, respectively, should outperform the market, with Strong Buy stocks outperforming more than any other rank.

Should You Consider American Airlines?The last thing we will do today, now that we have a grasp on the ESP and how powerful of a tool it can be, is to quickly look at a qualifying stock. American Airlines (AAL - Free Report) holds a #3 (Hold) at the moment and its Most Accurate Estimate comes in at -$0.30 a share 22 days away from its upcoming earnings release on October 22, 2026.

By taking the percentage difference between the -$0.30 Most Accurate Estimate and the -$0.31 Zacks Consensus Estimate, American Airlines has an Earnings ESP of +4.38%. Investors should also know that AAL is one of a large group of stocks with positive ESPs. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

AAL is part of a big group of Transportation stocks that boast a positive ESP, and investors may want to take a look at United Parcel Service (UPS - Free Report) as well.

United Parcel Service, which is readying to report earnings on October 27, 2026, sits at a Zacks Rank #3 (Hold) right now. Its Most Accurate Estimate is currently $1.65 a share, and UPS is 27 days out from its next earnings report.

United Parcel Service's Earnings ESP figure currently stands at +1.45% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $1.63.

Because both stocks hold a positive Earnings ESP, AAL and UPS could potentially post earnings beats in their next reports.

Find Stocks to Buy or Sell Before They're ReportedUse the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>

Quarterly financial reports play a vital role on Wall Street, as they help investors see how a company has performed and what might be coming down the road in the near-term. And out of all of the metrics and results to consider, earnings is one of the most important.

The earnings figure itself is key, of course, but a beat or miss on the bottom line can sometimes be just as, if not more, important. Therefore, investors should consider paying close attention to these earnings surprises, as a big beat can help a stock climb and vice versa.

Now that we know how important earnings and earnings surprises are, it's time to show investors how to take advantage of these events to boost their returns by utilizing the Zacks Earnings ESP filter.

The Zacks Earnings ESP, ExplainedThe Zacks Expected Surprise Prediction, or ESP, works by locking in on the most up-to-date analyst earnings revisions because they can be more accurate than estimates from weeks or even months before the actual release date. The thinking is pretty straightforward: analysts who provide earnings estimates closer to the report are likely to have more information.

Now that we understand the basic idea, let's look at how the Expected Surprise Prediction works. The ESP is calculated by comparing the Most Accurate Estimate to the Zacks Consensus Estimate, with the percentage difference between the two giving us the Zacks ESP figure.

In fact, when we combined a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time. Perhaps most importantly, using these parameters has helped produce 28.3% annual returns on average, according to our 10 year backtest.

Stocks with a ranking of #3 (Hold), or 60% of all stocks covered by the Zacks Rank, are expected to perform in-line with the broader market. Stocks with rankings of #2 (Buy) and #1 (Strong Buy), or the top 15% and top 5% of stocks, respectively, should outperform the market; Strong Buy stocks should outperform more than any other rank.

Should You Consider United Parcel Service?The final step today is to look at a stock that meets our ESP qualifications. United Parcel Service (UPS - Free Report) earns a #3 (Hold) 29 days from its next quarterly earnings release on October 27, 2026, and its Most Accurate Estimate comes in at $1.65 a share.

By taking the percentage difference between the $1.65 Most Accurate Estimate and the $1.63 Zacks Consensus Estimate, United Parcel Service has an Earnings ESP of +1.45%. Investors should also know that UPS is one of a large group of stocks with positive ESPs. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

UPS is part of a big group of Transportation stocks that boast a positive ESP, and investors may want to take a look at Copa Holdings (CPA - Free Report) as well.

Copa Holdings, which is readying to report earnings on November 18, 2026, sits at a Zacks Rank #3 (Hold) right now. Its Most Accurate Estimate is currently $4.01 a share, and CPA is 51 days out from its next earnings report.

The Zacks Consensus Estimate for Copa Holdings is $3.98, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of +0.67%.

UPS and CPA's positive ESP metrics may signal that a positive earnings surprise for both stocks is on the horizon.

Find Stocks to Buy or Sell Before They're ReportedUse the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>

United Parcel Service (UPS - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.

Shares of this package delivery service have returned -9.3% over the past month versus the Zacks S&P 500 composite's +1.3% change. The Zacks Transportation - Air Freight and Cargo industry, to which UPS belongs, has lost 7.2% over this period. Now the key question is: Where could the stock be headed in the near term?

Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.

Revisions to Earnings EstimatesRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.

Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.

For the current quarter, UPS is expected to post earnings of $1.63 per share, indicating a change of -6.3% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.5% over the last 30 days.

The consensus earnings estimate of $7.21 for the current fiscal year indicates a year-over-year change of +0.7%. This estimate has changed -0.2% over the last 30 days.

For the next fiscal year, the consensus earnings estimate of $7.97 indicates a change of +10.6% from what UPS is expected to report a year ago. Over the past month, the estimate has changed -0.1%.

With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for UPS.

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Projected Revenue GrowthEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.

For UPS, the consensus sales estimate for the current quarter of $22.11 billion indicates a year-over-year change of +3.3%. For the current and next fiscal years, $91.37 billion and $94.97 billion estimates indicate +3.1% and +3.9% changes, respectively.

Last Reported Results and Surprise HistoryUPS reported revenues of $22.83 billion in the last reported quarter, representing a year-over-year change of +7.6%. EPS of $1.76 for the same period compares with $1.55 a year ago.

Compared to the Zacks Consensus Estimate of $21.75 billion, the reported revenues represent a surprise of +4.98%. The EPS surprise was +6.67%.

The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.

ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.

While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.

As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

UPS is graded B on this front, indicating that it is trading at a discount to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about UPS. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

United Parcel Service (UPS - Free Report) closed at $94.75 in the latest trading session, marking a -4.35% move from the prior day. This change lagged the S&P 500's daily gain of 1.49%. At the same time, the Dow added 0.71%, and the tech-heavy Nasdaq gained 2.26%.

The stock of package delivery service has fallen by 2.89% in the past month, leading the Transportation sector's loss of 5.43% and undershooting the S&P 500's gain of 0.1%.

The investment community will be closely monitoring the performance of United Parcel Service in its forthcoming earnings report. The company is expected to report EPS of $1.63, down 6.32% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $22.11 billion, up 3.26% from the year-ago period.

For the full year, the Zacks Consensus Estimates are projecting earnings of $7.22 per share and revenue of $91.37 billion, which would represent changes of +0.84% and +3.06%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for United Parcel Service. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Right now, United Parcel Service possesses a Zacks Rank of #3 (Hold).

Investors should also note United Parcel Service's current valuation metrics, including its Forward P/E ratio of 13.72. This valuation marks a discount compared to its industry average Forward P/E of 15.02.

Also, we should mention that UPS has a PEG ratio of 1.77. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Transportation - Air Freight and Cargo was holding an average PEG ratio of 1.62 at yesterday's closing price.

The Transportation - Air Freight and Cargo industry is part of the Transportation sector. At present, this industry carries a Zacks Industry Rank of 107, placing it within the top 44% of over 250 industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

Shares of United Parcel Service, Inc. (NYSE:UPS – Get Free Report) have been assigned a consensus rating of “Hold” from the twenty-one brokerages that are currently covering the company, Marketbeat.com reports. One equities research analyst has rated the stock with a sell recommendation, eleven have assigned a hold recommendation, eight have given a buy recommendation and one has given a strong buy recommendation to the company. The average 12-month price target among analysts that have issued a report on the stock in the last year is $117.4118.

Several brokerages have commented on UPS. Oppenheimer raised their target price on shares of United Parcel Service from $115.00 to $117.00 and gave the stock an “outperform” rating in a report on Wednesday, July 29th. Citizens Jmp assumed coverage on shares of United Parcel Service in a research report on Wednesday, July 15th. They issued a “market perform” rating for the company. Weiss Ratings raised shares of United Parcel Service from a “sell (d+)” rating to a “hold (c-)” rating in a research note on Monday, August 17th. Wall Street Zen cut shares of United Parcel Service from a “buy” rating to a “hold” rating in a research report on Saturday. Finally, Citigroup increased their target price on United Parcel Service from $127.00 to $132.00 and gave the company a “buy” rating in a report on Thursday, July 9th.

Read Our Latest Research Report on UPS

Institutional Investors Weigh In On United Parcel Service A number of institutional investors have recently bought and sold shares of UPS. Legacy Wealth Managment LLC ID raised its holdings in shares of United Parcel Service by 48.6% during the 1st quarter. Legacy Wealth Managment LLC ID now owns 309 shares of the transportation company’s stock valued at $30,000 after purchasing an additional 101 shares in the last quarter. Markowski Investments bought a new stake in shares of United Parcel Service during the 2nd quarter worth $30,000. Allied Private Wealth LLC acquired a new position in United Parcel Service in the 2nd quarter valued at $34,000. Elyxium Wealth LLC acquired a new position in United Parcel Service in the 4th quarter valued at $40,000. Finally, Grove Bank & Trust raised its holdings in United Parcel Service by 49.8% in the 2nd quarter. Grove Bank & Trust now owns 379 shares of the transportation company’s stock worth $41,000 after acquiring an additional 126 shares during the period. 60.26% of the stock is currently owned by institutional investors and hedge funds. United Parcel Service Trading Down 0.1% Shares of NYSE UPS opened at $99.01 on Friday. United Parcel Service has a 12 month low of $82.00 and a 12 month high of $122.41. The company has a market cap of $84.23 billion, a price-to-earnings ratio of 18.40, a P/E/G ratio of 1.77 and a beta of 1.06. The company has a quick ratio of 1.18, a current ratio of 1.18 and a debt-to-equity ratio of 1.58. The business has a fifty day simple moving average of $105.85 and a 200-day simple moving average of $104.33.

United Parcel Service (NYSE:UPS – Get Free Report) last issued its quarterly earnings results on Tuesday, July 28th. The transportation company reported $1.76 earnings per share for the quarter, topping analysts’ consensus estimates of $1.65 by $0.11. The firm had revenue of $22.83 billion for the quarter, compared to analysts’ expectations of $21.86 billion. United Parcel Service had a return on equity of 37.50% and a net margin of 5.08%.United Parcel Service’s revenue was up 7.6% on a year-over-year basis. During the same quarter last year, the business posted $1.55 EPS. United Parcel Service has set its FY 2026 guidance at 7.220-7.220 EPS. Sell-side analysts predict that United Parcel Service will post 7.22 EPS for the current year.

United Parcel Service Dividend Announcement The firm also recently declared a quarterly dividend, which was paid on Thursday, September 3rd. Investors of record on Monday, August 17th were given a dividend of $1.64 per share. This represents a $6.56 annualized dividend and a yield of 6.6%. The ex-dividend date of this dividend was Monday, August 17th. United Parcel Service’s payout ratio is presently 121.93%.

United Parcel Service Company Profile (Get Free Report)

United Parcel Service, Inc (NYSE: UPS) is a global package delivery and logistics company that provides transportation, distribution and supply-chain services. Its offerings include time-definite delivery of packages and documents, ground and air transportation, international shipping, freight services, customs brokerage and logistics management.

UPS serves businesses and consumers in the United States and across international markets, connecting customers in more than 200 countries and territories.

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United Parcel Service Inc (UPS) Shares Fall 3.5% -- What GF Score of 76 Tells Investors

On September 16, 2026, United Parcel Service Inc UPS shares fell 3.5% to a current price of $98.77. This decline comes amid a 52-week trading range of $82.00 to $122.41, illustrating the stock's volatility over the past year.

GF Value™ verdict indicates the stock is trading at an 18.1% discount to its fair value of $120.56.With a GF Score™ of 76/100, UPS is rated as above average in terms of overall financial health and investment potential.The most notable signal is the insider activity, where insiders sold $2.7 million worth of shares over the past 12 months without any buying activity.Is UPS Overvalued or Undervalued?UPS's current price of $98.77 is significantly below the GF Value™ estimate of $120.56, suggesting that the stock is undervalued by approximately 18.1%. The GF Value™ is GuruFocus' intrinsic value calculation, which takes into account historical trading multiples, past business growth, and future performance projections. This undervaluation may present an attractive opportunity for investors; however, potential buyers should exercise caution given the recent decline in share price and the lack of insider buying, which could indicate a lack of confidence in the stock's short-term performance.

The GF Valuation label categorizes UPS as "Modestly Undervalued," suggesting that while there is a favorable margin of safety, the investment should be approached with careful consideration of the associated risks and market conditions.

How Does UPS's Valuation Compare to Its History?MetricCurrentHistoricalP/E (TTM)18.4x15.7xForward P/E12.3xN/AUPS's current P/E ratio of 18.4x is 17% above its 5-year median P/E of 15.7x. This indicates that the stock is trading at a premium compared to its historical valuation. When we compare this P/E analysis to the GF Value™ verdict, it shows a mixed signal; while the stock is currently undervalued according to GF Value™, its P/E suggests that it may be overvalued based on historical standards, highlighting potential caution for prospective investors.

What Does UPS's GF Score™ Tell Us?The GF Score™ is a composite score that evaluates a company's overall quality based on factors like financial strength, profitability, growth potential, valuation, and momentum. With a GF Score™ of 76/100, UPS demonstrates above-average quality, although there are areas that require attention.

MetricRatingGF Score™76/100Financial Strength5/10Profitability7/10Growth4/10Valuation10/10Momentum8/10UPS's strongest area is its Valuation rank of 10/10, indicating a favorable valuation relative to its intrinsic value. However, its Growth rank of only 4/10 suggests that the company may face challenges in expanding its revenue and earnings base. The Financial Strength score of 5/10 also indicates that there may be areas for improvement, particularly in liquidity and solvency metrics, which could affect future performance and investor sentiment.

What Are Gurus and Insiders Doing with UPS?A total of 15 gurus currently hold UPS stock, with 7 adding to their positions and 10 trimming their holdings in recent quarters. This mixed activity among gurus reflects varied opinions on the stock's potential. The presence of both buying and selling can create a complex narrative for investors, as it indicates differing strategies and perspectives on the company's future.

In terms of insider activity, the sale of $2.7 million in shares by insiders without any buying activity over the past year raises some concerns about their confidence in UPS's near-term outlook. This lack of insider buying may suggest that those with the most intimate knowledge of the company are not optimistic about the stock's immediate prospects, which is something potential investors should carefully consider.

What This Means for InvestorsBased on the GF Value™ assessment, UPS appears to be undervalued at its current trading price of $98.77, which is significantly below the estimated fair value of $120.56. However, the mixed signals from P/E analysis, insider selling, and the company's growth potential warrant cautious consideration for prospective investors. Investors should weigh the attractive valuation against the concerns regarding insider sentiment and growth prospects before making any decisions.

For additional insights into UPS's financial health and performance metrics, visit the United Parcel Service Inc UPS stock page, and explore options like the GF Value™ page or the GuruFocus Stock Screener for further analysis.

Frequently Asked QuestionsWhat is UPS's GF Score™?

UPS's GF Score™ is 76/100, indicating above-average quality in terms of financial health and investment potential.

Is UPS overvalued or undervalued?

UPS is considered undervalued based on the GF Value™ estimate, which indicates a fair value of $120.56 compared to the current price of $98.77.

What is UPS's P/E ratio?

UPS's P/E ratio is 18.4x, which is 17% above its 5-year median of 15.7x, suggesting that the stock is trading at a premium compared to its historical valuation.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

Disclosures I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.

United Parcel Service is rated Buy, supported by a leaner domestic network and a pivot to higher-margin SMB and healthcare segments. After shedding low-quality Amazon volume, UPS has restructured its U.S. operations, improving efficiency, automation, and profitability. International segment recovery, especially from Asia and easing network disruptions, is expected to drive further EPS growth.

UPS carries a yield above 6%, but the math behind that number tells a very different story than a healthy payout raise. Before adding it to an income portfolio, understand what actually pushed the yield this high.

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What Actually Produced the Yield United Parcel Service (NYSE:UPS | UPS Price Prediction) carries a headline dividend yield of 6.56%. The real question for an income investor is what produced it.

A yield rises for one of two reasons. The company raised the payout, or the share price fell. The verified data points overwhelmingly to the second.

The quarterly dividend has held at $1.64 per share for the seven most recent listed quarterly payments. The prior step-up carried the quarterly rate from $1.02 to $1.52. The payout has effectively been static since.

Price tells the other side of the story. UPS settled at $100.28, versus $152.62 on a five-year lookback, a return of -34.3%. The ten-year price return sits at just +38.49%. Price erosion is why the yield screens rich.

Coverage Belongs on Free Cash Flow For a fixed-network parcel carrier, reported earnings understate the real cost of the business. Aircraft, sortation buildings, and vehicles demand constant reinvestment. Coverage belongs on free cash flow after capex.

Reported full-year results: operating cash flow of $8.450 billion, capex of $3.685 billion, and dividends paid of $5.398 billion. Free cash flow came in at $5.470 billion, down 11.96%. The dividend consumed essentially all discretionary cash.

Forward guidance offers no more breathing room. Management targets roughly $5.5 billion in free cash flow, $3 billion in capex, a $1.3 billion pension contribution, and around $5.4 billion in dividends.

Volume, Costs, and Management’s Commitment The pressure in this case is structural. Consolidated volume fell 3.6% in the reported quarter, U.S. Domestic average daily volume dropped 3.3%, and the deliberate Amazon glide-down eliminated approximately 2 million pieces per day of lower-quality Amazon volume. Amazon now represents 9% of total UPS revenue. Interest expense climbed to $272 million, up 14.3%.

CEO Carol Tomé framed the reset directly:

“We now have a leaner, more automated, more agile network that will deliver operating leverage as volume grows. And importantly, incremental volume today carries materially better economics than before because of the structural changes we’ve made.”

On the payout itself, CFO Brian Dykes offered the operative commitment, saying UPS is “still planning to pay out around $5.4 billion in dividends in 2026, subject to Board approval.”

Committed View on Whether the Payout Holds The dividend is covered by free cash flow, but by a thin margin, and the board has held the quarterly rate flat rather than lift it. That is the tell. Management is defending the payout while a reconfigured network waits to deliver operating leverage on rising revenue per piece and a lower structural cost base.

The specific number to watch is quarterly free cash flow against the roughly $1.35 billion quarterly dividend obligation. Two consecutive quarters below that line would move the payout from tight to unsustainable, and would put the board’s next declaration into play. A 6%-plus yield sitting on flat coverage is exactly the profile we flagged in a free guide to the seven warning signs a big dividend is about to be cut.

Contact [email protected] for any questions or corrections.

United Parcel Service (UPS - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.

Over the past month, shares of this package delivery service have returned -4.5%, compared to the Zacks S&P 500 composite's -1.4% change. During this period, the Zacks Transportation - Air Freight and Cargo industry, which UPS falls in, has lost 4.1%. The key question now is: What could be the stock's future direction?

While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.

Revisions to Earnings EstimatesHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.

Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.

For the current quarter, UPS is expected to post earnings of $1.63 per share, indicating a change of -6.3% from the year-ago quarter. The Zacks Consensus Estimate has changed -1.3% over the last 30 days.

For the current fiscal year, the consensus earnings estimate of $7.22 points to a change of +0.8% from the prior year. Over the last 30 days, this estimate has remained unchanged.

For the next fiscal year, the consensus earnings estimate of $7.98 indicates a change of +10.5% from what UPS is expected to report a year ago. Over the past month, the estimate has changed +0.1%.

Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, UPS is rated Zacks Rank #3 (Hold).

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Projected Revenue GrowthWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.

In the case of UPS, the consensus sales estimate of $22.11 billion for the current quarter points to a year-over-year change of +3.3%. The $91.37 billion and $94.97 billion estimates for the current and next fiscal years indicate changes of +3.1% and +3.9%, respectively.

Last Reported Results and Surprise HistoryUPS reported revenues of $22.83 billion in the last reported quarter, representing a year-over-year change of +7.6%. EPS of $1.76 for the same period compares with $1.55 a year ago.

Compared to the Zacks Consensus Estimate of $21.75 billion, the reported revenues represent a surprise of +4.98%. The EPS surprise was +6.67%.

The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.

ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.

Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.

The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

UPS is graded B on this front, indicating that it is trading at a discount to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about UPS. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

United Parcel Service (UPS -2.08%), aka UPS, may be a famous company, but it is not necessarily a top choice among dividend stocks. Sure, shares in the parcel delivery company sport a high dividend yield of 6.2%, but concerns still linger about its ability to sustain such a high payout amid a years-long downturn.

Yet while UPS's 16-year dividend growth streak has ended, there's much merit in buying this stock today, both for its yield and for the potential for further upside from its ongoing turnaround.

Image source: Getty Images.

Investors remain on the fence about UPS Over the past few years, UPS has been struggling to get over its post-pandemic hangover. While it has been getting better lately, the company has yet to hit its previous high-water mark for profitability. As seen in UPS's latest quarterly earnings, efforts such as pivoting away from low-margin Amazon orders toward higher-margin business customers are helping improve the bottom line.

But even as results beat expectations, investors reacted negatively. Again, concerns about future results and the dividend's future still linger.

Why dividend doubts are overdone With annual dividend payments totaling $6.56 per share against forecasts calling for adjusted earnings of around $7.22 per share this year, UPS has a nearly 91% forward payout ratio. That ratio is well above what's considered healthy or sustainable.

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Moneyball Superscore

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Although UPS recently decided not to raise its payout, fears of a dividend cut remain. On the latest earnings conference call, CFO Brian Dykes reiterated plans to maintain the current payout rate. This suggests an opportunity to buy UPS today and collect its above-average yield while gaining exposure to the ongoing turnaround. Analysts remain confident in further improved results, with forecasts calling for earnings growth averaging around 7% between now and 2029.

Better yet, the stock could also rerate. UPS trades for 14.5 times forward earnings, while competitor FedEx trades for around 16 times forward earnings. If results meet current expectations and valuation converges, UPS, trading for around $105 today, could be trading north of $140 in three years' time.

Thomas Niel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and United Parcel Service. The Motley Fool recommends FedEx. The Motley Fool has a disclosure policy.

The company shook up its executive roles as part of the new model, naming the head of its U.S. business to lead its global operations, among other appointments.