Upcoming AWS Coverage on Hub Group Post-Earnings Results

LONDON, UK / ACCESSWIRE / May 5, 2017 / Active Wall St. announces its post-earnings coverage on United Parcel Service, Inc. (NYSE: UPS). The Company announced its first quarter fiscal 2017 results on April 27, 2017. The package and delivery service Company reported 6.2% increase in revenue and 3.9% gain in earnings. Register with us now for your free membership at:

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One of United Parcel Service's competitors within the Air Delivery & Freight Services space, Hub Group, Inc. (NASDAQ: HUBG), held a conference on Wednesday, April 26, 2017 to discuss its Q1 2017 results. AWS will be initiating a research report on Hub Group in the coming days.

Today, AWS is promoting its earnings coverage on UPS; touching on HUBG. Get our free coverage by signing up to:

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Earnings Reviewed

For the three months ended March 31, 2017, UPS' revenue increased 6.2% to $15.32 billion compared to revenue of $14.42 billion in Q1 2016 and ahead of analysts' consensus of $15.17 billion. Revenue grew in all segments and in all major product categories, as balanced market demand occurred across the company's broad product portfolio.

For Q1 2017, UPS's net earnings that rose to $1.16 billion, or $1.32 per share, compared to earnings of $1.13 billion, or $1.27 a share in Q1 2016. The improved per-share result was due to a 22% increase in Supply Chain and Freight segment's operating profit, strong underlying performance in the International segment and solid results in the Domestic segment, plus the favorable tax impact of adopting the new stock compensation accounting standard. The Company's earnings numbers surpassed Wall Street's expectations of $1.29 per share.

Segment Results

During Q1 2017, UPS' Domestic segment generated revenue of $9.54 billion, up 5% on a y-o-y basis, benefitting from strong demand for ecommerce deliveries. The segment's revenue per piece increased across all products, up 2.4% in total, as the Company benefitted from previously implemented base rate pricing actions. Next Day Air and Deferred Air shipments were up 3.9% and 4.1% respectively, as consumers continue to select UPS's quick and convenient solutions.

During Q1 2017, UPS Domestic segment expanded its portfolio through an initiative to pick-up and deliver Ground products on Saturday in 15 major metropolitan areas. This begins the rapid deployment to more than 4,700 cities by the peak holiday season in 2017. Operating costs for facility construction and Saturday initiative increased operating costs by approximately $35 million during the quarter. Headwinds from fuel surcharge lag, unusual weather, and a facility fire totaled about $50 million in one-time costs in the reported quarter. For Q1 2017, Domestic segment reported operating profit of $1.08 billion compared to operating profit of $1.10 billion in Q1 2016.

During Q1 2017, UPS' International segment generated strong top-line growth with increased demand for cross-border shipments as revenue grew to $4.06 billion compared to revenue of $2.91 billion in Q1 2016, 4.9% over Q1 2016, up 11% on a currency-neutral basis. Export shipment growth was strong across all UPS regions. For the international segment, operating margin was strong at 17.3%, despite the impact of unfavorable currency. The Company expects full year currency impact to be more than $400 million. The international segment generated robust, double-digit shipment growth of 14% in export and 11% in non-US domestic products. For Q1 2017, International segment reported operating profit of $529 million compared to operating profit of $574 million in Q1 2016. On a currency neutral basis, the segment reported operating profit of $648 million.

UPS' Supply Chain and Freight segment's revenue increased 13% to $2.72 billion compared to revenue of $2.42 billion in Q1 2016, due to higher-performing business development programs and improved market conditions across all business units. Tonnage increases in Freight Forwarding and UPS Freight increased revenue. All business units contributed to segment's operating profit growth of 22% to $179 million as profit improvement programs generated stronger performance.

Cash Matter

Capital expenditures to support network enhancements were $938 million during Q1 2017, demonstrating a run-rate at the annualized guidance level. UPS paid dividends of $774 million, an increase of 6.4% per share over the prior year, rewarding shareholders with continued strong dividend yield. The Company repurchased 4.2 million shares for approximately $450 million in-line with UPS' capital allocation policy.

Outlook

UPS reaffirmed fiscal 2017 adjusted diluted EPS guidance to be in the range of $5.80 and $6.10, which includes more than $400 million, or $0.30 per share of pre-tax currency headwinds.

Stock Performance

At the close of trading session on Thursday, May 04, 2017, United Parcel Service's stock price marginally declined 0.28% to end the day at $107.05. A total volume of 1.74 million shares were exchanged during the session. The Company's share price has gained 6.91% in the past twelve months. The Company's shares are trading at a PE ratio of 27.39 and have a dividend yield of 3.10%. The stock currently has a market cap of $94.24 billion.

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SOURCE: Active Wall Street