United Parcel Service, Inc. ($UPS) Earnings (Q1 FY22)

 United Parcel Service, Inc. ($UPS) Earnings and Opinion:


United Parcel Service is a company in the Industrials sector and operates in the Integrated Freight and Logistics industry. The company offers letter and package deliver, transportation, logistics, and related services. United Parcel Service was founded in 1907 and is currently headquartered in Atlanta, Georgia. The company started its trading on the stock market in 1999.

United Parcel Service EPS and Revenue (Q1 FY22):

  • EPS of $3.05 beating expectations of $2.88
  • Revenue of $24.38B beating expectations of $23.80B
United Parcel Service Q1 Financial Highlights:
  • Revenues up 6.4% (YOY)
  • Operating profit of $3.3B, up 17.6% (YOY)
  • EPS up 10.1% (YOY)
  • Targeted repurchase of shares of $2B
Opinion:
United Parcel Service (UPS) is currently trading lower after reporting earnings before the market opened this morning. The company reported solid beats on both EPS and revenue, while also recording some solid numbers in other categories. They also initiated a share buyback program, with a target to repurchase around $2B in shares by the end of the fiscal year. Revenues were up 6.4% and EPS were up 10.1%, both on a year-over-year basis. The operating profit is something that stood out to me, with it being $3.3B or up 17.6% (YOY). The company is currently facing inflationary worries with prices. Therefore, they have announced that they are going to start raising rates in order to help curb the inflation pressures in their company. Investors are very weary about how this will affect the company, so this is what is causing the stock to go lower today. I think the delivery industry is very tight and competitive, due to the fact that the business models are very similar. This could be a very worry some matter for UPS, it could lose a lot of customers due to the rising rates. However, if they are able to retain customers at a fair rate, this could lead to higher revenues and better profitability. It is going to be interesting to see how this risk plays out. I actually really like this business though, so I think it could be a quality time to buy, especially since it is off of its all-time highs. 


*Information from UPS, Yahoo Finance, Google
*Estimates from Zacks

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