Baird Looking For UPS To Pull Back To The $95 Level

Analysts at Baird recently hosted United Parcel Service, Inc UPS investor relations team to update its investment thesis on the company.

Thier opinion on UPS was "materially unchanged," however, they expect the stock to pullback towards the $95 range.Baird left its price target at $112.

Key Takeaways

B2C expected to be net-positive for UPS due to e-commerce growth, especially from "increased visibility of AMZN logistics efforts over the past year" UPS IT strategy is transitioning from defense to offense.

"While still in its early stages, we believe UPS increased end-user emphasis could potentially garner customer preference and loyalty unique to UPS, evidence of which would be a positive catalyst to shares and a source of further domestic margin gains," said Baird.

UPS remains confident in its 2016 Peak Holiday Season Plans. Aided by one more operating day between Thanksgiving and Christmas, two more automated hubs in operation and 100 percent implementation of ORION.

UPS capital deployment strategy:

• 1. Reinvest in the business
• 2. Growing Dividend consistent with EPS growth
• 3. Maintaining a strong balance sheet
• 4. Share repurchases