Bank of America Lowered UPS Price Target
The brokerage firm cited weaker domestic package volumes and falling Amazon volume as primary drivers for the reduction.
Updated on Sept. 21, 2026 in Transportation
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Bank of America has cut its price target for United Parcel Service from $115 to $108 following an unexpected decline in package volumes. The firm also lowered its revenue and earnings per share projections through 2027.
Why it matters
The firm adjusted its outlook due to disappointing volume trends for domestic packages and a sharp drop in Amazon-related shipping at the end of the second quarter. These revisions reflect ongoing pressure on the company to manage operating costs amid shifting demand.
Bank of America revised its 2026 revenue estimate to $91.3 billion and increased below-the-line expenses to $191 million. The new $108 price target is based on a valuation multiple of 13.5 times the 2027 earnings estimate.
The players
Bank of America
This multinational investment bank and financial services company provides research, banking, and wealth management services to individuals and corporations.
United Parcel Service
Commonly known as UPS, this global supply chain and logistics company provides package delivery, freight, and specialized transportation services.
Amazon
This multinational technology company focuses on e-commerce, cloud computing, and digital streaming, acting as a major shipping client for logistics firms.
The details
The brokerage maintained a Neutral rating on the stock while trimming earnings per share estimates by up to 4% for upcoming periods. UPS recently finalized cash payments associated with the separation of 7,500 drivers, contributing to higher anticipated expenses.
Timeline
Q2 2026 saw a sharp decline in Amazon package volumes.
Q3 2026 revenue is projected to reach $22.4 billion.
Second half 2026 is expected to feature continued pressure on domestic package volumes.
2027 serves as the benchmark year for the new $8 earnings per share target.
Market Landscape
This adjustment follows the pattern set by the 2023 Teamsters-UPS labor contract, as the company absorbs significant costs from recent workforce reductions. The move highlights how the logistics giant is navigating a contraction in high-volume client shipping while balancing increased labor expenses.
Investors may see continued volatility in the stock price as the company attempts to recover volume growth in the second half of 2026. Customers and shipping partners should watch for potential adjustments to delivery services as UPS targets efficiency improvements following workforce reductions.
The takeaway
Maintaining a Neutral rating suggests the brokerage sees limited upside for the company until package volumes stabilize. Shareholders and industry observers should prioritize monitoring the company's progress on its revenue targets for the remainder of the year.
Further reading
For more context on the current industry climate, visit the Transportation section.
Live Poll
Is the decline in package volumes a sign the national economy is headed in the wrong direction?
