We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Key Reasons Why UPS Stock Should Grace Your Portfolio Now
Read MoreHide Full Article
United Parcel Service ((UPS - Free Report) ) has been on a tear for sometime with its shares displaying an uptrend despite the prevalent pandemic-triggered distress. The stock has rallied 59.4% in the past six months, outperforming the S&P 500 Index’s 19.4% rally.
Let’s look into the factors that are working in favor of the stock.
Northbound Earnings Estimates: The Zacks Consensus Estimate for current-quarter earnings has been revised 11.8% upward over the past 60 days. For 2021, the consensus mark for the metric has moved 6.9% north in the same time frame. Such favorable estimate revisions reflect brokers’ confidence in the stock.
Given the wealth of information at the brokers’ disposal, it is in the best interest of investors to be guided by their expert advice and the direction of their estimate revisions. This is because the same serves as a key indicator in determining the price of a stock.
Solid Industry Rank: The industry to which UPS belongs, currently has a Zacks Industry Rank of 16 (of 250 plus groups). Such a solid rank places the company in the top 41% of the Zacks industries. Studies show that 50% of a stock price movement is directly related to the performance of the industry group it hails from.
In fact, an ordinary stock within a strong group is likely to outshine a robust stock in a weak industry. Therefore, taking the industry’s performance into account becomes imperative.
Other Tailwinds: UPS is benefiting from a significant increase in home deliveries amid the prevalent coronavirus pandemic. Notably, the need for door-to-door delivery of essentials during this crisis is rising. Owing to the surge in residential delivery volumes, UPS performed impressively in each of the three quarters of 2020. With online shopping becoming the preferred mode in the current situation, the trend is here to stay as the pandemic refuses to relent anytime soon. Therefore, logistics companies like UPS will surely fare well. We are also encouraged by UPS' solid free cash flow.
Additionally, UPS’ decision to support the distribution of the vaccine to combat coronavirus is an added positive. Notably, the FDA granted emergency use authorization to Pfizer (PFE - Free Report) /BioNTech’s (BNTX - Free Report) coronavirus vaccine candidate BNT162b2 on Dec 11. Notably, loaded trucks of UPS and rival FedEx (FDX - Free Report) were recently seen leaving Pfizer’s Kalamazoo, MI facility with the first shipments of the COVID vaccine for distribution in multiple states across the country.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Key Reasons Why UPS Stock Should Grace Your Portfolio Now
United Parcel Service ((UPS - Free Report) ) has been on a tear for sometime with its shares displaying an uptrend despite the prevalent pandemic-triggered distress. The stock has rallied 59.4% in the past six months, outperforming the S&P 500 Index’s 19.4% rally.
Let’s look into the factors that are working in favor of the stock.
Northbound Earnings Estimates: The Zacks Consensus Estimate for current-quarter earnings has been revised 11.8% upward over the past 60 days. For 2021, the consensus mark for the metric has moved 6.9% north in the same time frame. Such favorable estimate revisions reflect brokers’ confidence in the stock.
Given the wealth of information at the brokers’ disposal, it is in the best interest of investors to be guided by their expert advice and the direction of their estimate revisions. This is because the same serves as a key indicator in determining the price of a stock.
Top Zacks Rank & Impressive VGM Score: The stock has a Zacks Rank #2 (Buy), currently, and a VGM Score of B, which further highlights its attractiveness. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Solid Industry Rank: The industry to which UPS belongs, currently has a Zacks Industry Rank of 16 (of 250 plus groups). Such a solid rank places the company in the top 41% of the Zacks industries. Studies show that 50% of a stock price movement is directly related to the performance of the industry group it hails from.
In fact, an ordinary stock within a strong group is likely to outshine a robust stock in a weak industry. Therefore, taking the industry’s performance into account becomes imperative.
Other Tailwinds: UPS is benefiting from a significant increase in home deliveries amid the prevalent coronavirus pandemic. Notably, the need for door-to-door delivery of essentials during this crisis is rising. Owing to the surge in residential delivery volumes, UPS performed impressively in each of the three quarters of 2020. With online shopping becoming the preferred mode in the current situation, the trend is here to stay as the pandemic refuses to relent anytime soon. Therefore, logistics companies like UPS will surely fare well. We are also encouraged by UPS' solid free cash flow.
Additionally, UPS’ decision to support the distribution of the vaccine to combat coronavirus is an added positive. Notably, the FDA granted emergency use authorization to Pfizer (PFE - Free Report) /BioNTech’s (BNTX - Free Report) coronavirus vaccine candidate BNT162b2 on Dec 11. Notably, loaded trucks of UPS and rival FedEx (FDX - Free Report) were recently seen leaving Pfizer’s Kalamazoo, MI facility with the first shipments of the COVID vaccine for distribution in multiple states across the country.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>