Value
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 7.1 |
| P/S | 9.6 |
| EV/EBITDA | 6.0 |
| Fwd P/E | 8.4 |
| PEG | 4.8 |
| Analyst target | 4.0 |
- ▸Forward P/E: 13.8x
- ▸PEG: 1.75
UPS · Why this verdict
Why United Parcel Service (UPS) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score4.9/10
ConfidenceHIGH
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
With a debt-to-equity ratio of 1.8, UPS carries above-average financial leverage that reduces flexibility and adds a structural cost overhang to future earnings. Bear case | If earnings grow and debt is reduced, the leverage ratio should decline below 1.5 over the next 12 months, easing financial risk. | →Stable |
| CounterThe Piotroski financial strength score of only 3 out of 9 suggests balance-sheet deterioration beyond just leverage, which may persist. | ||
UPS has beaten earnings estimates in 3 of the last 4 quarters with an average positive surprise of 11.5%, suggesting the business generates profits above what analysts model. Earnings | Earnings per share results will continue to meet or exceed analyst estimates over the next 12 months, sustaining a positive beat rate. | →Stable |
| CounterRevenue has been declining at roughly 2% year-over-year, meaning earnings beats could reflect cost-cutting rather than organic demand growth, limiting durability. | ||
UPS sits above its 200-day moving average with a bullish MACD signal and rising on-balance volume, reflecting sustained buying interest despite slowing revenue. Momentum breakdown | The price should remain above the $102.57 stop-loss level and hold its technical uptrend over the next 12 months. | →Stable |
| CounterVolume accumulation has not been confirmed by fundamental revenue growth, raising the risk that the technical trend reverses once macro conditions weaken. | ||
The current share price of $108.83 is essentially at the analyst consensus price target, leaving only 0.2% upside to take-profit — a signal that near-term capital appreciation is largely exhausted. Warnings | Analyst price targets should be revised upward by at least 10% over 12 months for a new entry to be justified. | →Stable |
| CounterUPS's forward price-to-earnings ratio of 13.6 is not cheap by sector standards, meaning targets are unlikely to be raised unless revenue declines reverse. | ||
With a debt-to-equity ratio of 1.8, UPS carries above-average financial leverage that reduces flexibility and adds a structural cost overhang to future earnings.
→StableBear case
- Expectation
- If earnings grow and debt is reduced, the leverage ratio should decline below 1.5 over the next 12 months, easing financial risk.
CounterThe Piotroski financial strength score of only 3 out of 9 suggests balance-sheet deterioration beyond just leverage, which may persist.
UPS has beaten earnings estimates in 3 of the last 4 quarters with an average positive surprise of 11.5%, suggesting the business generates profits above what analysts model.
→StableEarnings
- Expectation
- Earnings per share results will continue to meet or exceed analyst estimates over the next 12 months, sustaining a positive beat rate.
CounterRevenue has been declining at roughly 2% year-over-year, meaning earnings beats could reflect cost-cutting rather than organic demand growth, limiting durability.
UPS sits above its 200-day moving average with a bullish MACD signal and rising on-balance volume, reflecting sustained buying interest despite slowing revenue.
→StableMomentum breakdown
- Expectation
- The price should remain above the $102.57 stop-loss level and hold its technical uptrend over the next 12 months.
CounterVolume accumulation has not been confirmed by fundamental revenue growth, raising the risk that the technical trend reverses once macro conditions weaken.
The current share price of $108.83 is essentially at the analyst consensus price target, leaving only 0.2% upside to take-profit — a signal that near-term capital appreciation is largely exhausted.
→StableWarnings
- Expectation
- Analyst price targets should be revised upward by at least 10% over 12 months for a new entry to be justified.
CounterUPS's forward price-to-earnings ratio of 13.6 is not cheap by sector standards, meaning targets are unlikely to be raised unless revenue declines reverse.
TrendMatrix Research · core thesis
Engine thesis — one sentence
United Parcel Service trades near its analyst price target with strong earnings momentum (3 beats in 4 quarters, averaging 11.5% upside surprise), but elevated debt and a negative risk/reward ratio signal limited near-term appreciation potential.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
4.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 4.8 |
| Gross margin | 0.5 |
| Op margin | 2.5 |
| Net margin | 3.0 |
| Current ratio | 4.6 |
| FCF quality | 6.4 |
| Moat | 4.2 |
| Piotroski F | 3.3 |
- ▸Excellent ROE: 33%
- ▸No competitive moat
- ▸Weak Piotroski F-Score: 3/9
Growth
1.1/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 2.1 |
| EPS growth | 0.0 |
- ▸Declining revenue: -2%
Momentum
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 8.1 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 0.9 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.3 |
| Analyst rating | 7.5 |
| Price target | 5.5 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.5 |
| quality rank | 6.8 |
| growth rank | 2.3 |
Technical
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.0 |
| support resistance | 1.3 |
| 52w position | 8.5 |
Risk (lower is worse)
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.3 |
| days to cover | 6.2 |
| volatility | 6.4 |
| put call | 8.7 |
| implied vol | 6.2 |
| beta | 6.9 |
| debt equity | 3.4 |
| news risk | 5.0 |
Catalyst
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 8.2 |
| dividend safety | 5.2 |
| news activity | 8.0 |
- ▸Strong earnings: 3B/1M
- ▸Dividend: 593.0%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (5)
- MOMENTUM:6.7>=5.5
- INSIDER:OK
- EARNINGS_PROXIMITY:22d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.1=NEGATIVE
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-1.08
Upside
-7.1%
Downside
6.5%
Sizing output
AVOID
SetupBreakout — Golden cross, above all MAs, RSI 55, MACD bullish
EdgeCatalyst-Driven — Earnings in 22d with 3/4 beat streak
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 3.9 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Momentum at 6.7) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-1.1=NEGATIVE) reinforce the read. Current asymmetry R:R is -1.08 — supplementary context, not the trigger for this path.
The strongest dimensions are Momentum at 6.7, Value at 6.5, and Risk (lower is worse) at 6.4; the weakest are Growth at 1.1, Technical at 3.9, and Quality at 4.4. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -1.08 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Earnings Beat Consistency
Trip ifEPS surprise falls below 0% in at least 3 of the next 4 quarters.
- P2Leverage Headwind
Trip ifDebt-to-equity ratio rises above 2.0 within the next 12 months.
- P3Price Momentum Strength
Trip ifPrice drops below $102.57 stop-loss level, more than 5% below the current $108.83.
- P4Analyst Target Ceiling
Trip ifAnalyst consensus price target remains below $120 for more than 6 consecutive months.