On CNBC's “Mad Money Lightning Round,” Jim Cramer said no to United Parcel Service (NYSE:UPS). “I still don't like UPS,” he added.
United Parcel Service will announce its third-quarter results before the opening bell on Oct. 28. Analysts expect the company to report quarterly earnings at $1.32 per share, down from $1.76 per share in the year-ago period. The company is projected to report quarterly revenue of $20.88 billion, compared to $22.25 billion a year earlier.
On Monday, Citigroup analyst Ariel Rosa maintained a Buy rating for United Parcel Service and lowered the price target from $114 to $112.
UPS Price Action: United shares were up 0.24% at $84.25 during premarket trading on Wednesday. The stock is trading near its 52-week low of $82.00, reflecting significant pressure over the past year with a year-to-date performance down 32%. This decline highlights the challenges UPS has faced, particularly in a competitive landscape where e-commerce giants like Amazon continue to exert pressure on logistics and delivery services.
From a technical perspective, the stock is currently trading just below its 50-day moving average of $85.62, which is about 1.6% above the current price. This proximity to the moving average suggests that a breakout above this level could signal a potential reversal or recovery attempt. However, the 200-day moving average sits significantly higher at $102.12, indicating a broader bearish trend that may take time to reverse.
Key support is identified at $83.73, which could provide a floor for the stock in the event of further downward pressure. Conversely, resistance is seen at $87.43, a level that traders will be watching closely for signs of a potential rally. The current RSI of 46.75 indicates a neutral momentum, suggesting that the stock is neither overbought nor oversold, which may lead to increased volatility as it seeks direction.
In comparison to its peers, UPS holds a market cap of $71.24 billion, positioning it among the larger players in the logistics sector. This relative size may provide some stability, but the ongoing challenges in the market necessitate a cautious approach to any bullish positions.
Given the current setup, a break above the resistance level of $87.43 could open the door for a more significant recovery, while failure to hold above the support at $83.73 may lead to further declines. Traders should be particularly attentive to these levels as they could dictate the near-term trajectory of the stock.
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