Street View: UPS needs to deliver on cost-cutting measures

United Parcel Service UPS.N posted second-quarter profit below expectations and opted not to issue annual revenue and margin forecasts

The delivery giant, along with rival FedEx FDX.N, is seen as a bellwether for the health of the global economy due to its role serving clients across industries and geographies

Median PT of 32 brokerages covering the stock is $105 - LSEG data

MACRO UNCERTAINTY, DE MINIMIS IMPACT TO REMAIN

Jefferies ("buy," PT: $115) says despite the uncertain macro, co continues to execute on things under their control by focusing on long-term margin expansion and operational efficiency

Morgan Stanley ("underweight," PT: $75) says while they had expected a challenging quarter, they were on the lookout for a pull forward of the co's $3.5 bln cost savings plan, driving a results beat

"While the macro is choppy, UPS has more moving parts than most companies," brokerage adds

TD Cowen ("hold," PT: $101) says co is facing risks to domestic margin if it does not achieve buyout agreement targets with its Amazon phase-out slower than expected

J.P. Morgan ("neutral," PT: $96) says with the impact from China being the biggest drop following the de minimis exemption removal disrupting small-package volume, longer tailwinds on domestic margins are expected