UPDATE: Sterne Agee Raises Target to $110 on United Parcel Service

Sterne Agee maintains its Buy rating on United Parcel Service (NYSE: UPS) as the company's progress shapes up in the fourth quarter.

Sterne Agee comments, "Despite a challenging global environment, UPS reported adjusted 4Q11 EPS of $1.25, which was below our estimate of $1.28 but in line with consensus EPS of $1.25. Above the line operating earnings were actually in line with our above consensus expectations, but higher interest expense and a higher than expected tax rate resulted in the in-line results. Incremental margins of 41% represent an impressive acceleration from 12% levels in 3Q11. Nonetheless, our expectations were above consensus, and these results were strong in a challenging environment."

UPS closed at $75.65 a share on Tuesday.