UPS Soars to Record High on Q1 Earnings Beat

The stock is seeing much more options activity than usual

Deputy Editor
Jul 30, 2020 at 11:37 AM
facebook X logo linkedin

The shares of United Parcel Service Inc (NYSE:UPS) are soaring, up 13.1% at $139.86 at last check, following a positive fiscal first-quarter report. The company reported earnings per share of $2.13, exceedingly higher than the estimated $1.07 per share, and better-than-expected revenue. 

Today's rally had UPS earlier gapping to a new record high of $145.47. Meanwhile, the $135 region, which capped the stock's former record high at the start of 2018, swooped in to catch today's lows. In the past six months, the equity has added 30.4%. 

Analysts are split, with seven out of 17 sporting a "strong buy," seven at a tepid "hold," and three at a "strong sell." Meanwhile, the 12-month consensus target price of $110.83 is a 21.3% discount to current levels, meaning a round of price-target hikes could be on the horizon. 

The options pits are looking much more bullish, per UPS' 50-day call/put volume ratio of 2.62 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio stands higher than 98% of readings from the past 12 months, indicating that traders have been particularly call-heavy in the last 10 weeks. 

Today, options are running at 10 times the usual daily volume, with 114,000 calls and 29,000 puts across the tape so far. Most popular are the weekly 7/31 145- and 140-strike calls, with new positions being opened at both. This means traders are betting on more upside for UPS by tomorrow's expiration. 

Meanwhile, an unwinding of short interest could help push United Parcel Service stock higher as well. The 18.08 million shares sold short represent a 2.6% of the stock's available float, or over four days' worth of pent-up buying energy, at the stock's average pace of trading. 



How to collect 1 dividend check every day for LIFE

Did you know you could collect 1 dividend check every day the market is open? You could also do it starting with just $605! For me, I'm collecting 70 dividend checks every quarter…which averages around 1.1 dividend checks every business day. There's no trading behind this... no penny stocks or high-risk investments. All you do is buy and hold and you're set. There's no set up required either. If you start buying the dividend stocks I show you today... you could collect 1 dividend per day starting as early as this week. Click here for all the details.