UPS Falls Short in Q2, Trims 2012 Outlook

The company says the global slowdown will cool earnings

   

UPS Falls Short in Q2, Trims 2012 Outlook

United Parcel Service (NYSE:UPS) said on Tuesday that its second-quarter earnings increased to $1.12 billion, up from $1.092 billion during the same time last year.

Revenue for the logistics and shipping company increased to $13.35 billion, up from $13.19 billion in 2011. That disappointed Wall Street, which had been looking for $13.7 billion, Reuters noted.

10632418 moving freight 200x200 UPS Falls Short in Q2, Trims 2012 Outlook
3 Service Stocks to Sell Now

Adjusted EPS for the second quarter was $1.15, up 7.5% from $1.07 last year, but falling short of analysts who had predicted $1.17.

Investors were unhappy with the results, sending UPS shares down more than 5% in Tuesday morning trading.

UPS also cut is outlook for 2012, saying it now expects earnings per share of between $4.50 and $4.70. That is down from an earlier forecast of between $4.75 and $5.00 a share.

Company officials attributed the diminished outlook to rising concerns over a weakening U.S. economy, the ongoing European economic crisis, and slowing exports from Asia.

UPS’s European presence is increasing due to its acquisition of the Netherlands-based TNT Express.

Analysts cited by Reuters attributed the missed quarterly forecasts and lowered outlook to reduced international freight shipping.

Last month, shipping rival FedEx (NYSE:FDX) posted lower earnings for its fiscal fourth quarter that still beat Wall Street forecasts, but lowered its outlook for the current fiscal year due to the worsening global slowdown.


Article printed from InvestorPlace Media, http://investorplace.com/2012/07/ups-falls-short-in-q2-trims-2012-outlook/.

©2014 InvestorPlace Media, LLC

Comments are currently unavailable. Please check back soon.