United Parcel Services (UPS 0.85%) hasn't been a winner for investors in 2025. The stock also performed dismally in 2022, 2023, and 2024.
However, better days could lie ahead for the package delivery giant. Should you buy UPS stock while it's below $105?
NYSE: UPS
Key Data Points
A pivotal turning point?
UPS might have had a pivotal turning point on Oct. 28, 2025. That's the date the company released its third-quarter results.
Sure, UPS' revenue fell by 2.6% year-over-year. However, this decline was expected. What wasn't anticipated was how handily UPS would beat Wall Street's top and bottom-line estimates.
Analysts projected revenue of $20.8 billion. UPS delivered revenue of $21.4 billion. The consensus adjusted earnings per share (EPS) estimate for Q3 was $1.30. UPS blew past that number with actual adjusted EPS of $1.74.
The company reduced its operationally workforce by 34,000 in the first nine months of the year. It previously forecast a reduction of 20,000. Additionally, UPS cut 14,000 management jobs.
CEO Carol Tomé stated during the Q3 earnings call that she had personally reached out to the new Postmaster General of the U.S. Postal Service (USPS) earlier this year. Those conversations appear to have borne fruit. UPS and the USPS have reached a preliminary agreement on a renewed relationship, where UPS will handle "middle mile" transportation of packages, while the USPS will handle "final mile" transportation.
All of this positive news has boosted UPS' share price. Since early October, the stock has risen by around 17%.
Image source: UPS.
Uncertainties linger
UPS isn't yet entirely out of the woods, though. Some uncertainties linger.
For example, the Trump administration's tariffs could still cause problems for UPS, particularly with its small-to-medium-sized business (SMB) customers. Tomé noted in the Q3 earnings call, "Next year is when you're going to feel the full brunt of some of these tariffs hitting some of these SMBs."
It remains to be seen if UPS' dramatic decision to slash its shipment volumes with Amazon (AMZN 0.19%) will pay off. Tomé called this move "the most significant strategic shift in our company's history." She will look like a hero if it works but could be shown the exit door if it doesn't.
Some income investors are also anxious about UPS' dividend. The company paid $4 billion in dividends during the first nine months of 2025 but generated free cash flow of only $2.7 billion. That imbalance is at least a little concerning.
Buy UPS stock?
Should investors buy UPS stock while it's below $105? Yes and no.
Growth-oriented investors may not find UPS particularly appealing. Even if the uncertainties the company faces don't cause significant issues, it's unlikely to deliver jaw-dropping growth anytime soon.
Value investors, on the other hand, could view UPS as an attractive stock to buy. Its forward price-to-earnings ratio is a relatively low 13.6. Also, the worst seems to be over for the package delivery company.
Finally, I think UPS is a good pick for income investors. Its forward dividend yield of 6.6% is enticing. My prediction is that a dividend cut isn't on the way. Management has repeatedly expressed its support for the dividend program.
What about the gap between UPS' free cash flow and dividends paid out? If this imbalance persists for too long, the company would likely have to cut its dividend.
However, CFO Brian Dykes said in the Q3 earnings call that UPS should "generate significantly more free cash flow over time." I agree with that assessment. The restructuring related to the Amazon glide-down is expected to boost profits and free cash flow. UPS is making progress in attracting higher-profit business, particularly in healthcare logistics.
UPS isn't a stock for everyone. If you're a value or income investor, though, I think it's worth considering – especially while the share price is below $105.
