Will Solid E-commerce Growth Boost UPS' Earnings In Q1?
Zacks Investment Research | Apr 17, 2019 10:17PM ET
United Parcel Service, Inc. (NYSE:UPS) is scheduled to report first-quarter 2019 results on Apr 25, before the market opens.
In the last reported quarter, the company delivered a positive surprise of 1.6%. Moreover, the bottom line improved on a year-over-year basis. Although revenues fell short of the Zacks Consensus Estimate, the same increased year over year, primarily on the back of the company’s impressive performance in the holiday season.
Let’s see how things shape up for this announcement. Notably, the Zacks Consensus Estimate for first-quarter earnings has moved 11.8% south in the last 90 days.
Factors Likely at Play
UPS has been making significant investments in the facilities’ upgrade to meet surging demand following rapid e-commerce growth. These high capital expenditures might weigh on the company’s bottom-line growth in the first quarter.
Moreover, with UPS having a substantial exposure in China, trade tensions between the United States and China might impact results in the quarter.
However, similar to the last few quarters, solid e-commerce growth is likely to boost the top line in the first quarter as well. Expanded package volumes at the U.S. Domestic Package segment are anticipated to aid the segmental results. Notably, the Zacks Consensus Estimate for first-quarter U.S. Domestic Package revenues stands at $10,687 million, higher than $10,227 million reported a year ago.
Additionally, the international package segment’s encouraging performance should drive the top line in the soon-to-be-reported quarter. The Zacks Consensus Estimate for first-quarter International Package revenues is pegged at $3,660 million, higher than the year-earlier reported figure of $3,533 million.
Meanwhile, the consensus mark for revenues at the Supply Chain and Freight segment is pegged at $3,433 million compared with $3,353 million reported in the prior year.
United Parcel Service, Inc. Price and EPS Surprise
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