Jim Cramer's Take on UPS: Insights Ahead of Earnings

Jim Cramer Shares His Thoughts on UPS Stock
In a recent broadcast of CNBC's "Mad Money Lightning Round," renowned investor Jim Cramer expressed his concerns regarding United Parcel Service (NYSE: UPS). He stated, "I still don't like UPS," indicating that he has reservations about the company's prospects.
Upcoming Earnings Announcement
United Parcel Service is set to reveal its third-quarter earnings before the stock market opens. Industry analysts are predicting earnings of $1.32 per share, which is a decline from the previous year's earnings of $1.76 per share. Additionally, the company is projected to generate quarterly revenue of $20.88 billion, significantly lower than last year’s $22.25 billion.
Analyst Ratings and Price Targets
On the same day, Citigroup analyst Ariel Rosa reaffirmed a Buy rating for UPS, although he adjusted the price target downwards from $114 to $112. This suggests a cautious optimism amid ongoing challenges in the logistics sector.
Current Stock Movement
Recently, UPS shares saw a slight increase of 0.24%, trading at $84.25 in premarket sessions. The stock has faced considerable headwinds over the past year, plunging 32% year-to-date. As a result, it is currently hovering close to its 52-week low of $82.00.
Technical Analysis Overview
From a technical standpoint, UPS is trading just below its 50-day moving average, which is positioned at $85.62. This proximity to the average indicates that a breakthrough above this level could potentially signal a recovery phase. Conversely, the 200-day moving average, significantly higher at $102.12, suggests the broader market trend remains bearish.
Support and Resistance Levels
Key support for the stock is identified at $83.73, which may act as a safety net if downward pressure continues. On the flip side, resistance is expected around the $87.43 mark, a crucial point that traders will monitor for signs of upward momentum. The current Relative Strength Index (RSI) stands at 46.75, indicating neutral momentum. This condition may result in creating volatility as traders look for direction.
Market Context and Position
UPS holds a substantial market capitalization of $71.24 billion, which secures its place as one of the larger entities within the logistics sector. This notable size could afford it some level of stability, yet the persistent difficulties in the market mean investors should tread carefully when considering bullish positions.
Potential for Recovery
Considering the market setup, if UPS manages to break through the resistance at $87.43, it could pave the way for a more robust recovery. However, should it fail to maintain above support at $83.73, further declines may be anticipated. As such, traders are encouraged to keep a close eye on these significant levels, as they could dictate the stock's short-term trajectory.
Frequently Asked Questions
What are Jim Cramer’s views on UPS stock?
Jim Cramer has expressed his reluctance to invest in UPS, highlighting concerns about the company’s future prospects.
When will UPS announce its earnings?
UPS is scheduled to announce its third-quarter earnings before the market opens.
What is the expected revenue for UPS this quarter?
Analysts expect UPS to report quarterly revenue of $20.88 billion.
What are the current support and resistance levels for UPS?
Current support is at $83.73, while resistance is observed at $87.43.
What might influence UPS’s stock price moving forward?
The stock price could be influenced by the earnings report, market trends, and competition from e-commerce giants.
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