Can UPS Stock Beat the Market Over the Next 5 Years?

3 hours ago 1

Rick Munarriz, The Motley Fool

Mon, January 12, 2026 astatine 6:27 AM CST 4 min read

UPS shares person surrendered astir a 3rd of their worth implicit the past 5 years.
Revenue maturation has failed to apical 3% successful immoderate of the past 4 years, but analysts spot the bottommost enactment increasing again successful 2026.
If it tin support its streak of yearly dividend increases arsenic good arsenic its turnaround strategy going, UPS tin bushed the marketplace successful the adjacent 5 years.
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The past 5 years person been challenging for United Parcel Service (NYSE: UPS) investors. Shares of the bundle transportation elephantine person plummeted 32% successful that time. Is the outlook brighter if we look retired to the adjacent 5 years? It would beryllium hard not to be.

Recent momentum is promising. UPS has risen 9% done the archetypal six trading days of 2026, climbing 32% since bottoming retired 3 months ago. At slightest 4 analysts boosted their terms targets connected the banal conscionable past week. With a juicy dividend output of 6.1%, UPS whitethorn connection a potent operation of superior gains alongside a hefty quarterly distribution.

Turnaround stories are ne'er casual and clean, and a batch tin hap with UPS. But let's commencement by taking a look backmost astatine the past 5 years earlier turning our attraction to the future.

Someone blessed to beryllium accepting a package.

UPS was initially an aboriginal person successful responding to the COVID-19 crisis. Folks turned to e-commerce and location delivery, and UPS was 1 of galore proscription stocks to benefit. Revenue roseate successful the mid-teens for UPS successful 2020 and 2021, pursuing a decennary of dependable but uninspiring affirmative single-digit top-line growth.

Then the wheels started to travel off, metaphorically speaking. Amazon (NASDAQ: AMZN) outgrew its dependency connected UPS, truthful the 2 mutually agreed to a lighter load of the online retailer's increasing shipping volume. Its SurePost programme with the United States Postal Service for last-mile transportation besides came undone astatine the extremity of 2024. It averted a 2023 onslaught by the UPS Teamsters union, but the consequent five-year statement locks successful escalating labour costs annually done 2028. Throw successful the tariff-saddled scenery of 2025 -- and the extremity of the U.S. de minimis exemption that ended duty-free presumption for low-value imports precocious past twelvemonth -- and it's been a unsmooth fewer years for UPS.

The scoreboard, arsenic each of these events unfolded, is telling. UPS's gross maturation decelerated to 3% successful 2022, and things lone got worse aft that. Revenue would diminution 9% successful 2023 and timepiece successful level successful 2024, and by the clip the numbers are successful for past twelvemonth it's expected to beryllium a 3% top-line slide.

Around the clip its shares were bottoming retired successful the fall, UPS warned of a 13% diminution successful shipping measurement during the seasonally spiked 4th quarter. That outlook was upgraded to a comparatively amended 11% arsenic the vacation play played out.