United Parcel Service (UPS): Assessing Valuation as Shares Rebound on Efficiency Overhaul Plans

United Parcel Service (UPS) shares have been moving recently, and investors are taking a closer look at what is driving the stock's performance over the past month. With earnings growth and revenue gains in mind, here is what stands out.

See our latest analysis for United Parcel Service.

UPS shares have rebounded impressively in the past month with a 12.3% share price return. Momentum has faded a bit following a rapid run-up. While the 1-year total shareholder return stands at -24.8%, this comes after steady revenue and earnings growth. This suggests investors remain cautious but are watching for a potential turnaround.

If you’re watching how logistics leaders are recovering, this could be a smart moment to broaden your search and discover fast growing stocks with high insider ownership

Given UPS's recent gains and sizable discount to analyst price targets, the central question is clear: Is the current share price undervaluing future growth, or is the market already factoring in what is to come?

Most Popular Narrative: 2.3% Undervalued

The most widely followed narrative sets a fair value target slightly above UPS's recent close, suggesting that the stock may be trading below what the company could be worth if catalysts play out. With management executing a radical overhaul and tackling major pressures, all eyes are on the company’s next moves.

“Launched in early 2025, UPS's ‘Efficiency Reimagined’ outlined the company’s largest network overhaul in company history. This multi-year initiative details management's goals to streamline domestic operations.

UPS is expected to close 73 facilities by 2027, move 50% of package volume away from Amazon by 2026, and increase automation with AI to promote efficiency and per unit costs.”

Read the complete narrative.

Curious what bold assumptions underpin this value? The narrative teases a dramatic shift driven by efficiency moves, operational shakeups, and earnings growth ambitions. Find out which forecasted changes could send this stock higher or keep it stuck.

Result: Fair Value of $95.21 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent declines in revenue and ongoing labor tensions could challenge the turnaround story and reduce expectations for a lasting recovery.

Find out about the key risks to this United Parcel Service narrative.

Build Your Own United Parcel Service Narrative

If you’re not convinced by this perspective or want to uncover your own insights, you have the tools to craft a fresh take in just minutes, so go ahead and Do it your way.

A great starting point for your United Parcel Service research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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