One-glance verdict
Undervalued
$151.33 our estimate vs market $110.96
Wall Street consensus: $115.42 (-23.7% lower than our fair-value estimate)
27% below our estimate, below the bear case
Fundamentals snapshot
United Parcel Service, Inc.
UPS · NYQ · Industrials · Integrated Freight & Logistics
Current price
$110.96
52-week range
$90.84 - $122.41
Market cap
$94.48B
Balance sheet
Stretched
7.74x Adequate
Net debt $23.68B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Revenue grew 3.1% last year.
- Reward Returns 28.6% on equity, ahead of 66% of its peers.
- Risk Net debt grew 42.6% over 3 years.
- Risk Stock trades 27.4% above its 5-year average P/E.
What this company does
United Parcel Service, Inc.
United Parcel Service (UPS) is a company that picks up and delivers packages, like the ones you get from online shopping. Their money mainly comes from these package deliveries within the U.S. and from delivering packages internationally, which matters because it shows how much goods are moving around the world.
What it actually does
At its core, UPS is a global shipping and logistics company. It collects packages and documents from businesses and individuals, sorts them through an extensive network of ground and air transportation, and delivers them to their destinations. UPS operates in over 200 countries and territories, handling millions of packages daily. The company's services are crucial for e-commerce, business-to-business shipments, and various supply chain needs, ensuring that goods move efficiently from origin to destination.
U.S. Domestic Package
This is UPS's largest business segment, responsible for delivering letters, documents, and packages throughout the United States. It encompasses both ground and air delivery services, offering various speeds from overnight express to more economical options. This segment is the primary engine for UPS's revenue, benefiting from the dense network and economies of scale that come with handling a massive volume of packages within the country. Customers range from large enterprises and e-commerce merchants to small businesses and individual households.
International Package
This segment handles package operations outside of the United States, covering export, import, and domestic services within other countries. It provides time-definite delivery options for small packages across Europe, Asia, Canada, and Latin America. This part of the business is crucial for global trade, enabling businesses to ship goods across borders efficiently. It serves global manufacturers, retailers, healthcare companies, and small to medium-sized businesses (SMEs) looking for reliable international shipping solutions.
Supply Chain & Freight
This segment is a diverse offering that goes beyond standard package delivery. It includes services like contract logistics (managing warehousing and distribution for other companies), freight forwarding (arranging transportation of larger goods), customs brokerage (helping clear goods through customs), and specialized logistics for industries like healthcare. UPS also offers services such as mail services, digital delivery platforms, and shipment insurance within this segment. While smaller in revenue compared to package operations, it often involves higher-value services and can deepen customer relationships.
What management is betting on now
UPS is currently focused on a strategy of "better, not bigger," emphasizing higher-quality revenue and improved productivity. A key initiative is the "Network of the Future" plan, which aims to optimize and automate its core logistics network to reduce costs and improve efficiency. This involves significant investment in automation projects to handle anticipated volume growth with less reliance on labor. Management is prioritizing growth in premium markets, such as healthcare and small business services, and is also focusing on enhancing the customer experience through technology and a disciplined approach to pricing and capital allocation.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q4
$2.22B
FY2025 Q1
$1.44B
FY2025 Q2
$-775.00M
FY2025 Q3
$1.51B
FY2025 Q4
$2.59B
FY2026 Q1
$1.19B
FY2026 Q2
$166.00M
FY2026 Q3
$2.41B
Revenue
$22.85B
Net income
$1.16B
Diluted EPS
1.37
Operating cash flow
$2.90B
Free cash flow
$2.41B
Fetching…
Sources
Revenue
$22.83B
Net income
$604.00M
Diluted EPS
0.71
Operating cash flow
$859.00M
Free cash flow
$166.00M
Fetching…
Sources
Revenue
$21.20B
Net income
$864.00M
Diluted EPS
1.02
Operating cash flow
$2.22B
Free cash flow
$1.19B
Fetching…
Sources
Revenue
$24.48B
Net income
$1.79B
Diluted EPS
2.10
Operating cash flow
$3.30B
Free cash flow
$2.59B
Fetching…
Sources
Revenue
$21.41B
Net income
$1.31B
Diluted EPS
1.55
Operating cash flow
$2.48B
Free cash flow
$1.51B
Fetching…
Sources
Revenue
$21.22B
Net income
$1.28B
Diluted EPS
1.51
Operating cash flow
$348.00M
Free cash flow
$-775.00M
Fetching…
Sources
Revenue
$21.55B
Net income
$1.19B
Diluted EPS
1.40
Operating cash flow
$2.32B
Free cash flow
$1.44B
Fetching…
Sources
Revenue
$25.30B
Net income
$1.72B
Diluted EPS
2.00
Operating cash flow
$3.31B
Free cash flow
$2.22B
Fetching…
Sources
Is it cheap or expensive?
Fair value $151.33 vs current price $110.96
Wall Street consensus is the average analyst price target: $115.42 (-23.7% lower than our fair-value estimate).
Our most-likely fair value is $151.33 a share — about 36.4% above today's price of $110.96, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Stretched
Net debt $23.7B. Interest coverage 7.7x.
Net debt
$23.68B
Interest coverage
7.74x
United Parcel Service, Inc.'s profit covers its interest bill about 7.7 times over. which is stronger than most peers shown here.
Stretched
Worse cushion
Baseline
Better cushion
UPS
BASELINE
United Parcel Service, Inc.
Total debt $30.52B Interest coverage 7.74x This is the baseline the peer rows are being compared against.
Total debt $34.13B Interest coverage 6.83x -12% vs UPS Has roughly the same debt cushion as UPS.
Total debt $31.48B Interest coverage 4.80x -38% vs UPS Carries about 1.6x less debt cushion than UPS.
Total debt $3.97B Interest coverage 3.33x -57% vs UPS Carries about 2.3x less debt cushion than UPS.
Total debt $2.15B Interest coverage 10.96x +42% vs UPS Carries about 1.4x more debt cushion than UPS.
Total debt $1.45B Interest coverage 11.50x +49% vs UPS Carries about 1.5x more debt cushion than UPS.
What you should know
The case for and against UPS
3 Rewards
3 Risks
Rewards
-
Revenue grew 3.1% last year.
-
Returns 28.6% on equity, ahead of 66% of its peers.
-
Free cash flow was positive in 9/10 years.
Risks
-
Net debt grew 42.6% over 3 years.
-
Stock trades 27.4% above its 5-year average P/E.
-
Operating margin compressed from 13.0% to 9.3% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
21.38x
Forward P/E
13.71x
P/B
6.30x
P/S
1.03x
EV/EBITDA
9.71x
PEG ratio
1.57x
Profitability
How much profit each dollar creates
Gross margin
22.4%
Operating margin
9.3%
Net margin
4.8%
ROE
28.6%
ROA
7.2%
Health
Liquidity and balance-sheet strength
Debt / equity
2.03x
Current ratio
1.24x
Quick ratio
1.12x
Total debt
$30.52B
Total cash
$6.84B
Growth
How the business has been compounding
Revenue TTM
$91.37B
Revenue 5Y CAGR
-2.3%
EPS TTM
5.19
EPS 5Y CAGR
-20.8%
Cash flow
How much cash the business throws off
Operating CF TTM
$9.29B
Free CF TTM
$4.76B
FCF margin
5.2%
Dividend
Shareholder payout
Yield
5.9%
Payout ratio
126.4%
Last ex-div date
2026-11-16