UPS Inc (UPS US): Buy: Better yields and leaner network drive earnings recovery

研报英文原文证据摘录

UPS Inc (UPS US): Buy: Better yields and leaner network drive earnings recovery

). UPS also raised the 2026

52-WEEK PRICE (USD)non-GAAP EPS guidance to cUSD7.22 (c4% y-o-y growth vs flat earlier), 1.5% above

consensus. In contrast, DHL raised 2026 EBIT guidance by 4.8% (implies flat y-o-y), 130.00

while FedEx’s CY26 outlook implies 16% adj. OP growth and 16.7% adj. EPS growth 103.50

y-o-y. UPS expects further operating leverage from the now-completed Amazon

77.00

glide-down (June 2026) and improving Asia export momentum since May. 07/25 01/26 07/26

Target price: 120.00

High: 120.00 Low: 82.58 Current: 105.53

We keep FY26e adj. OP largely unchanged, in line with the revised guidance, and

Source: LSEG IBES, HSBC estimates

leave FY27-28 estimates largely intact. For 3Q26, we forecast adj. OP profit of

USD2.0bn (9.1% margin), down 6% y-o-y and 5% below consensus on seasonal

Parash Jain*

weakness. We still expect a 4Q26 rebound (adj. OP up 12% y-o-y) as cost savings Global Head of Transport & Logistics Research

ramp and UPS laps the de-minimis exemption expiry (since September 2025). The Hongkong and Shanghai Banking Corporation Limited parashjain@hsbc.com.hk

+852 2996 6717

Maintain Buy and TP of USD120. The stock fell 7% on 28 July (vs S&P 500 up 0.2%,

Deepak Maurya*, CFA

FedEx up 0.6%, and DHL up 0.3%). Since 27 February (pre-Middle East conflict), UPS Analyst, Asia Transport

is down 8% (vs +8% for the S&P 500, flat for FedEx, and +15% for DHL). We see the The Hongkong and Shanghai Banking Corporation Limited

deepakmaurya@hsbc.com.hk

c6% average 2026-28e dividend yield as supportive, and we expect investors to +852 2822 4292

refocus on mix improvement and margin recovery as structural cost savings ramp. Bruce Chu*, CFA

Analyst, Asia Transport