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United Parcel (UPS) Beats Q1 Earnings, Revenue Estimates
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United Parcel Service, Inc. (UPS - Free Report) reported first-quarter 2017 earnings of $1.32, beating the Zacks Consensus Estimate of $1.30 per share. Earnings increased 3.9% on a year-over-year basis. Results were aided by the substantial increase in operating profit of the Supply Chain and Freight unit.
Revenues improved 6.2% to $15,315 million from the year-ago quarter, beating the Zacks Consensus Estimate of $15,179.5 million. Revenues grew in all three segments of the company.
Segmental Details
U.S. Domestic Package revenues climbed 5% year over year to $9,535 million in the reported quarter. But segmental operating profit declined to $1,076 million.
Segmental average daily package volumes climbed 2.6% driven by a 2.3% rise in Ground products and 3.9% growth in Next Day Air services. Deferred Air products were up 4.1%. Average revenue per piece was up 2.4%.
International Package revenues improved 4.9% to $3,058 million despite the adverse impact of foreign currency. Export shipments improved 14% in the first quarter on the back of growth in Europe and Asia. However, segmental operating profits declined to $529 million in the quarter. The measure came in at $648 million on a currency neutral basis. Revenue per piece grew 1.1%.
Supply Chain and Freight revenues increased 12.5% to $2,722 million. Segmental results were aided by the acquisition of Coyote Logistics, which was completed in the third quarter of 2015. Operating profits in the segment climbed 22% to $179 million in the reported quarter.
Liquidity
United Parcel generated free cash flow of $693 million and spent $938 million as capital expenditure in the reported quarter. Moreover, United Parcel paid approximately $774 million as dividend to shareholders in the first quarter of 2017. Additionally, it bought back 4.2 million shares for $450 million. We are impressed with the company’s efforts to reward shareholders consistently through buybacks and dividend payouts.
United Parcel Service, Inc. Price, Consensus and EPS Surprise
United Parcel is a Zacks Rank #4 (Sell) company. It still expects 2017 adjusted earnings per share in the band of $5.80 to $6.10, which includes $400 million of pre-tax currency headwinds. Foreign currency related headwinds are also expected to hurt 2017 results. The Zacks Consensus Estimate for 2017 currently stands at $5.95 per share.
Investors interested in the broader transportation space keenly await the first-quarter earnings reports of Spirit Airlines (SAVE - Free Report) , Copa Holdings (CPA - Free Report) and Air Lease Corporation (AL - Free Report) that are slated to be released on Apr 28, May 10 and May 4, respectively.
The Best & Worst of Zacks
Today you are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. From 1988 through 2015 this list has averaged a stellar gain of +25% per year. Plus, you may download 220 Zacks Rank #5 "Strong Sells." Even though this list holds many stocks that seem to be solid, it has historically performed 6X worse than the market. See these critical buys and sells free >>
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United Parcel (UPS) Beats Q1 Earnings, Revenue Estimates
United Parcel Service, Inc. (UPS - Free Report) reported first-quarter 2017 earnings of $1.32, beating the Zacks Consensus Estimate of $1.30 per share. Earnings increased 3.9% on a year-over-year basis. Results were aided by the substantial increase in operating profit of the Supply Chain and Freight unit.
Revenues improved 6.2% to $15,315 million from the year-ago quarter, beating the Zacks Consensus Estimate of $15,179.5 million. Revenues grew in all three segments of the company.
Segmental Details
U.S. Domestic Package revenues climbed 5% year over year to $9,535 million in the reported quarter. But segmental operating profit declined to $1,076 million.
Segmental average daily package volumes climbed 2.6% driven by a 2.3% rise in Ground products and 3.9% growth in Next Day Air services. Deferred Air products were up 4.1%. Average revenue per piece was up 2.4%.
International Package revenues improved 4.9% to $3,058 million despite the adverse impact of foreign currency. Export shipments improved 14% in the first quarter on the back of growth in Europe and Asia. However, segmental operating profits declined to $529 million in the quarter. The measure came in at $648 million on a currency neutral basis. Revenue per piece grew 1.1%.
Supply Chain and Freight revenues increased 12.5% to $2,722 million. Segmental results were aided by the acquisition of Coyote Logistics, which was completed in the third quarter of 2015. Operating profits in the segment climbed 22% to $179 million in the reported quarter.
Liquidity
United Parcel generated free cash flow of $693 million and spent $938 million as capital expenditure in the reported quarter. Moreover, United Parcel paid approximately $774 million as dividend to shareholders in the first quarter of 2017. Additionally, it bought back 4.2 million shares for $450 million. We are impressed with the company’s efforts to reward shareholders consistently through buybacks and dividend payouts.
United Parcel Service, Inc. Price, Consensus and EPS Surprise
United Parcel Service, Inc. Price, Consensus and EPS Surprise | United Parcel Service, Inc. Quote
Outlook
United Parcel is a Zacks Rank #4 (Sell) company. It still expects 2017 adjusted earnings per share in the band of $5.80 to $6.10, which includes $400 million of pre-tax currency headwinds. Foreign currency related headwinds are also expected to hurt 2017 results. The Zacks Consensus Estimate for 2017 currently stands at $5.95 per share.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Key Releases Coming Up
Investors interested in the broader transportation space keenly await the first-quarter earnings reports of Spirit Airlines (SAVE - Free Report) , Copa Holdings (CPA - Free Report) and Air Lease Corporation (AL - Free Report) that are slated to be released on Apr 28, May 10 and May 4, respectively.
The Best & Worst of Zacks
Today you are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. From 1988 through 2015 this list has averaged a stellar gain of +25% per year. Plus, you may download 220 Zacks Rank #5 "Strong Sells." Even though this list holds many stocks that seem to be solid, it has historically performed 6X worse than the market. See these critical buys and sells free >>