Industry experts noticed a wreck about shipping companies this week.
UPS (NYSE:UPS) tumbled Thursday, falling to a six-month low, after issuing weak 2020 guidance, and experts warned that it could get worse for the delivery company’s stock.
Thursday, the shipper released results from its fourth-quarter. Adjusted earnings per share were $2.11, an 8.8% increase over the same period last year. The company’s results highlight the strong volume growth in the U.S. Domestic segment and the impact of successful execution from all segments.
Factoring in was a non-cash, after-tax mark-to-market (MTM) pension charge of $1.8 billion, an after-tax transformation charge of $39 million, and U.S. Domestic after-tax legal contingency and expense charges of $91 million, predominantly related to the New York cigarette case. The total impact to EPS was $2.23 per diluted share.
At least investment specialist says UPS has a lot of work to do, while being a bit more partial to the prospects for rival FedEx (NYSE:FDX).
"Likely [UPS is] going to play catch-up to what’s been seen in FedEx,” said Mark Newton of Newton Advisors said during the same segment.
"FedEx has been down almost 50% in the last two years since it peaked in early 2018. So of the two, I’d be more apt to buy FedEx. It has been trending relatively lower, but it started to stabilize and, you know, technically, I think that’s a bit of a better bet right now."
UPS shares began Friday down 29 cents to $107.71
