UPS stock reversed lower Tuesday ahead of United Parcel Service's investor day conference after announcing new strategic initiatives and providing 2026 financial targets.
UPS during its conference plans to discuss its new "Network of the Future" initiative, which it says will optimize and further automate its core integrated network and lower costs. The Atlanta-based company also said it will highlight several initiatives to boost market share and expand its addressable market to drive incremental growth.
"We executed the strategy we set forth nearly three years ago by changing almost every aspect of our business," CEO Carol Tome said. "After coming off a difficult market in 2023, the small package industry is poised to return to growth in 2024 and beyond. Over the next three years, we plan to make bold moves to create a growth flywheel in premium markets, while at the same time drive higher productivity and efficiency."
Tome said the new initiatives should result in higher revenue, expanded operating margins and increased free cash flow.
UPS forecasts 2026 consolidated revenues between $108 billion and $114 billion, up from $90.96 billion in 2023. FactSet analysts predict 2026 revenue of $101.1 billion.
The company guided an adjusted operating margin above 13% for 2026. UPS sees its U.S. domestic package segment with an adjusted operating margin of at least 12%. It forecasts an international operating margin between 18% and 19%.
UPS expects 2026 free cash flow between $17 billion and $18 billion. The company noted capital spending from 2024 to 2026 will represent about 5.5% of total revenue.
UPS Stock Today
UPS stock fell 8.2% Tuesday, ending a streak of five consecutive daily gains. Shares surged more than 3% premarket. UPS shares have been in a downtrend since February 2022. The stock retreated 8.3% in 2024.
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