UPS Profit Increases During First Quarter by 10%

On Thursday, United Parcel Service said that its profit rose during the first quarter by 10% to over $1.13 billion, helped in part from an increase in its ground and next-air shipments in the U.S.

The results beat the forecasts on Wall Street for profit, but revenue came in less than what had been expected.

UPS often is considered an economic bellwether both in the United States as well as globally due to the amount of shipments the company handles between companies and from companies to consumers.

The e-commerce business at UPS has seen strong growth with the increase in shopping online.

Of late, UPS has had mixed signals, with the growth slowing in its emerging economies.

UPS has adjusted prices, for instance raising the price on bulky packages that do not weigh much, as they take up additional space. It is also reducing costs with software that routes drivers and other types of measures.

The company, based in Atlanta said it has per share earnings of $1.27 during the first quarter in comparison to one year ago when earnings were $1.12 per share.

The estimate of analysts was for earnings to reach $1.22 per share.

Revenue increased by 3% to over $14.43 billion, which fell short of analyst’s forecasts of more than $14.57 billion.

About 50% of the overall increase in its revenue was due to the acquisition of Coyote Logistics, which helped increase the supply chain in UPS and its freight segment.

UPS stood reconfirmed its forecast released earlier of earnings for the full year of $5.70 to $5.90 a share, which is in line with expectations of analysts.

Shares of UPS were up 89 cents in trading prior to the opening bell on Thursday putting the stock at $107.34.

UPS stock has increased 11% since the start of 2016, while the S&P 500 is only up 2.5%.

UPS stock has increased by over 9% during the last 12 months.

 

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