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Big Brown is hunkering down.
With tariffs so much in the news lately, United Parcel Service (UPS) has a page on its website dedicated to "tariffs and their impact on global trade."
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“Recent U.S. tariff changes may impact your global shipping,” the world's largest package delivery company said. “We’ve provided the latest updates as well as some solutions that may help you streamline cross-border shipping.”
The most recent update on the page is dated March 12 and announces the government's 25% tariff on all steel and aluminum imports.
The Atlanta package delivery giant recently unveiled UPS Global Checkout, which it says guarantees up front the amount online shoppers will pay in duties, fees and taxes.
“Until now, international purchases often arrived with an unpleasant surprise – an additional bill for unpaid import costs,” the company said. “UPS Global Checkout solves that problem.”
Tariffs have not been good for stocks
The tariff situation is likely to get a lot more unpleasant as President Donald Trump's latest set of levies become a reality.
Trump has declared April 2 "Liberation Day" and he said the tariffs would free the U.S. from its reliance on foreign goods. To do this, Trump has said he’ll impose reciprocal tariffs to match the duties that other countries charge on U.S. products.
2025 stock market forecasts
Stocks were pummeled in the first quarter, and Trump's tariffs have been a major driver of the market selloff.
Goldman Sachs analysts recently warned that the U.S. economy faces a sharply higher risk of recession over the next 12 months, as tariffs reduce growth, stoke inflation and deepen the market's first-quarter decline.
Back in January, Brian Dykes, UPS's chief financial officer, told analysts during the company's fourth-quarter earnings call that "our guidance for 2025 does not reflect any significant potential global trade implications due to changes in tariffs."
But Chief Executive Carol Tome also noted that "we need to be mindful that trade follows policy, and tariffs aren't necessarily good for trade."
UPS changing relationship with Amazon
UPS reported better-than-expected earnings for the quarter, but revenue fell short of Wall Street’s estimates.
Tome also discussed the company's plan to reduce the amount of Amazon (AMZN) volume it delivers by more than 50% by the second half of 2026 — five times faster than it did between 2021 and 2024.
“Amazon is our largest customer, but it’s not our most profitable customer,” she said. “Its margin is very dilutive to the U.S. domestic business."
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Amazon made up 11.8% of total company revenue for the year, Tome said, noting that "if we take no action, it will likely result in diminishing returns.”
Shares of UPS, which is slated to report quarterly results at the end of the month, are down 13% year-to-date and off 26% from a year ago.
Investment firms have adjusted their stock price targets for UPS.
Analyst cites UPS rival warning
Susquehanna lowered its price target on UPS to $120 from $130 while affirming a neutral rating on the shares, according to The Fly.
The investment firm trimmed its UPS estimates into earnings season primarily on lower U.S. volumes and related operating leverage.
The update follows FedEx's (FDX) guidance reduction earlier this month and rising macroeconomic conservatism toward its forecasts across transports.
During a March 21 earnings call with analysts, FedEx Chief Financial Officer John Dietrich said the company was lowering its 2025 adjusted-earnings forecast "given the ongoing challenges in the global industrial economy, inflationary pressures, and the uncertainty surrounding global trade policies."
Barclays lowered the firm's price target on UPS to $90 from $100 and maintained an underweight rating on the shares.
The investment firm says that while questioning the dividend at UPS "is controversial," it views the company as needing to widen profit margins into a declining volume environment in the domestic package business.
Barclays said it suspected this would prove more challenging than management guidance currently suggests. Barclays views UPS's dividend yield as "less safe."
Related: Analysts reboot FedEx stock price targets after earnings
Last month, Bank of America Securities lowered the firm's price target on UPS to $129 from $133 and reiterated a buy rating on the shares ahead of the quarterly results.
The firm also pared its first-quarter-earnings forecast by 15% to $1.31 a share from $1.55, given softer demand from tariff uncertainty and winter weather.
B of A had previously targeted domestic volumes to fall 5.7% year-over-year given the start of the removal of 50% of Amazon (AMZN) volumes by mid-2026.
In addition, the investment firm cited the impact of rate increases as the carrier in-sourced the 50% of SurePost volumes it did not already serve, referring to UPS's economy service for less urgent, lower value shipping.
B of A is now targeting 8% domestic volume declines given weather impacts and a slight freeze in demand ahead of increased tariffs.
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