Sign InUPS Q3 Earnings Preview: Strong Growth Expected in Key Segments
Alex Vellor
Investors are eagerly awaiting United Parcel Service (UPS) to release its quarterly earnings, with Wall Street analysts expecting solid growth. Here's a breakdown of what analysts predict, focusing on key numbers and trends that could impact the stock.
Earnings and Revenue Outlook
UPS is forecasted to post earnings of $1.65 per share, marking a 5.1% increase compared to the same quarter last year. Analysts also predict revenues of $22.26 billion, reflecting a 5.7% year-over-year increase. However, it's worth noting that the earnings per share (EPS) estimate has been slightly revised downward by 0.4% over the past month, hinting at some adjustments in analysts' expectations.
Earnings revisions often signal potential market movements. It is worth watching for any further updates, as changes in estimates are frequently tied to short-term stock performance.
Key Revenue Segments to Watch
Analysts are also closely following specific UPS business segments. Here's what the forecasts suggest for some of the company’s most important areas:
| Key Metric | Estimate (Q3 2024) | Change YoY |
|---|---|---|
| Revenue - Supply Chain Solutions | $3.35 billion | +6.8% |
| Revenue - International Package | $4.43 billion | +3.9% |
| Revenue - U.S. Domestic Package | $14.40 billion | +5.4% |
| Revenue - International Package (Cargo & Other) | $165.95 million | +5% |
Each of these segments is expected to show year-over-year growth, signaling strength across UPS’s global operations. Investors should particularly note the Supply Chain Solutions segment, projected to grow by nearly 7%, which reflects the ongoing demand for logistics services, especially amid global supply chain disruptions.
Package Volume and Pricing
Analysts have also provided estimates for package volumes and average revenue per piece, two key indicators of UPS’s operational performance. Here’s a summary of the expected numbers:
| Package and Pricing Metrics | Estimate (Q3 2024) | YoY Comparison |
|---|---|---|
| Avg. Daily Package Volume - Int'l Package - Export | 1.63 million | 1.62 million |
| Avg. Daily Package Volume - Int'l Package - Domestic | 1.53 million | 1.52 million |
| Avg. Revenue Per Piece - Int'l Package - Total | $21.00 | $20.78 |
| Avg. Revenue Per Piece - U.S. Domestic Package - Total | $12.59 | $12.54 |
| Avg. Revenue Per Piece - U.S. Domestic Package - Ground | $11.18 | $11.10 |
UPS’s U.S. Domestic Package segment is expected to remain a key driver, with analysts forecasting an average revenue per piece of $12.59, up from $12.54 last year. Meanwhile, the International Package segment is also predicted to show growth, with average revenue per piece climbing to $21.00 from last year's $20.78.
International Package Performance
Growth in international business is critical for UPS, given its vast global network. Here's how analysts think the International Package segment will perform:
| International Package Metrics | Estimate (Q3 2024) | YoY Comparison |
|---|---|---|
| Avg. Revenue Per Piece - International Package - Domestic | $8.00 | $7.73 |
| Avg. Revenue Per Piece - International Package - Export | $33.22 | $33.09 |
| Avg. Daily Package Volume - International Package - Total | 3.17 million | 3.14 million |
The average revenue per piece for international domestic shipments is forecasted to rise to $8.00, reflecting ongoing strength in cross-border commerce. Additionally, export package volume is projected to hit 1.63 million packages per day, showing steady international demand.
These projections highlight several key trends. UPS’s core domestic and international package businesses are showing stable growth, while the supply chain and logistics services continue to benefit from strong global demand.
While EPS estimates have seen slight downward revisions, overall growth forecasts remain solid.
A strong earnings beat could drive the stock higher, especially if UPS exceeds expectations in its high-growth international and supply chain segments.
About The Author
Alex Vellor
