Redburn Atlantic analysts upgraded United Parcel Service (NYSE:UPS) shares to Buy and lifted the price target to $180 on higher earnings estimates.
“We believe UPS is at, or close to, trough revenue, volume, margin and share price levels. We see cause for positivity with key macroeconomic data sets stable, if not showing signs of improvement,” analysts said.
“This, combined with UPS’ cyclical nature, supports our expectation that volumes will turn positive in Q224,” they added.
In addition, during the March Investor Day, UPS management set ambitious three-year goals aimed at achieving an EBIT margin of over 13% through strategies such as reducing the workforce, consolidating operations, and enhancing productivity with technology, Redburn analysts highlighted.
They believe that the UPS stock is nearing or at its lowest point and while the ambitious three-year objectives set by the company could be difficult to achieve by 2026, they may act as a significant driving force that could propel the share price upwards in the coming 12 months.
UPS shares rose 1% ahead of Wednesday's market open.