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United Parcel Service (NYSE:UPS) is scheduled to release its earnings report on Tuesday, April 29, 2025. Historically, over the past five years, the stock has experienced a negative one-day return following 60% of its earnings announcements. These negative returns have shown a median of -6.5% and a maximum of -14.1%.

Analysts’ consensus estimates for the upcoming report indicate earnings per share (EPS) of $1.38 on sales of $21.02 billion. This represents a decrease compared to the same period last year, when UPS reported EPS of $1.43 on sales of $21.7 billion. The anticipated revenue decline is partly attributed to the divestiture of Coyote within its supply chain solutions segment, and the U.S. business is also expected to be impacted by soft demand. On a positive note, the International package segment, which saw strong high single-digit year-over-year growth in the previous quarter, may continue its momentum in Q1.

For event-driven traders, analyzing UPS’s historical post-earnings stock performance can offer valuable insights. While the immediate market reaction will hinge on how the actual results and future outlook compare to consensus estimates and broader expectations, understanding historical patterns presents potential trading strategies:

1. Pre-Earnings Positioning: By considering the historical probability of a negative one-day return, traders can strategically position themselves before the earnings release.
2. Post-Earnings Trading: Examining the correlation between the initial stock reaction and medium-term returns after earnings can inform trading decisions made after the announcement.

From a fundamental perspective, UPS currently has a market capitalization of $83 billion. Over the last twelve months, the company generated $91 billion in revenue and maintained operational profitability, reporting $8.5 billion in operating profits and a net income of $5.8 billion.

That said, if you seek upside with lower volatility than individual stocks, the Trefis High Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 91% since its inception.

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United Parcel Service’s Historical Odds Of Positive Post-Earnings Return

Some observations on one-day (1D) post-earnings returns:

• There are 20 earnings data points recorded over the last five years, with 8 positive and 12 negative one-day (1D) returns observed. In summary, positive 1D returns were seen about 40% of the time.
• However, this percentage decreases to 27% if we consider data for the last 3 years instead of 5.
• Median of the 8 positive returns = 6.1%, and median of the 12 negative returns = -6.5%

Additional data for observed 5-Day (5D), and 21-Day (21D) returns post earnings are summarized along with the statistics in the table below.

UPS 1D, 5D, & 21D Post Earnings Return

Correlation Between 1D, 5D, and 21D Historical Returns

A relatively less risky strategy (though not useful if the correlation is low) is to understand the correlation between short-term and medium-term returns post earnings, find a pair that has the highest correlation, and execute the appropriate trade. For example, if 1D and 5D show the highest correlation, a trader can position themselves “long” for the next 5 days if 1D post-earnings return is positive. Here is some correlation data based on 5-year and 3-year (more recent) history. Note that the correlation 1D_5D refers to the correlation between 1D post-earnings returns and subsequent 5D returns.

UPS Correlation Between 1D, 5D and 21D Historical Returns

Is There Any Correlation With Peer Earnings?

Sometimes, peer performance can have influence on post-earnings stock reaction. In fact, the pricing-in might begin before the earnings are announced. Here is some historical data on the past post-earnings performance of United Parcel Service stock compared with the stock performance of peers that reported earnings just before United Parcel Service. For fair comparison, peer stock returns also represent post-earnings one-day (1D) returns.

UPS Correlation With Peer Earnings

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.