JP Morgan analyst upgrades UPS shares
On Wednesday September 9, 2009, 11:06 am EDT
United Parcel Service shares rise on upgrade from JP Morgan analyst
NEW YORK (AP) -- A JP Morgan analyst upgraded United Parcel Service Inc. on Wednesday, saying its
share price does not reflect the boost it would get from a recovering economy.
Analyst Thomas R. Wadewitz upgraded the shares to "Overweight" with a $70 price target, from "Neutral" with a $57 price target. UPS shares rose $1.54, or 2.9 percent, to $55.64 in morning trading.
"We believe that the greatest single driver of UPS stock is likely to be performance of the US economy," Wadewitz wrote, "and at the present time our sense is that UPS reflects less anticipation of a turn in the economy than most other large cap industrial and transportation stocks."
He said the potential downside risk for the shares is moderate, while the potential for a gain is significant. Wadewitz also said that while there has not been a strong turnaround in transport demand, comments from trucking companies, as well as rail volumes and airline freight data "point to incremental improvement in demand. We believe that gradual improvement in parcel/express volumes is also likely," he wrote.