United Parcel Service (UPS 2.66%) appears to have hit a key turning point in 2025 as it looks to revamp its business. Still, the stock fell around 20% last year. Even after rising off its lows, the stock is still down by roughly 50% from its 2022 highs. Is now the time to buy UPS stock?
What has been going on at UPS?
A huge spike in demand for package delivery during the coronavirus pandemic's height led investors to push UPS' stock price to lofty levels. When that demand spike faded, as the world grew accustomed to COVID-19, investors moved on to other trades, and UPS' stock began to fall. UPS made the situation worse by announcing plans for a major corporate overhaul.
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The plan is to cut costs, integrate more technology into the operation, and focus on the company's highest-margin business relationships. Staff cuts, facility closures and sales, material IT investments, and reducing exposure to high-volume, low-margin customers are all key steps in what has been a multi-year process.
The big picture is that the company has been spending more money and bringing in less revenue, so the vital industrial company's financial results have been pretty ugly.
Is there any good news?
Given the dynamics of UPS' turnaround effort, you can understand why Wall Street has been downbeat on the company's stock. Yet something important changed in 2025. Despite revenue falling in the U.S. business, revenue per piece increased in each of the last three quarters of the year.
NYSE: UPS
Key Data Points
That's exactly what you would expect to see, given the effort to focus on higher-margin business. It is aided by the effort to build a leaner, more cost-efficient operation. However, those were just the early green shoots showing that the company's approach was having the intended effect. Management is suggesting that 2026 will be the real inflection point of the turnaround effort. That helps explain why the stock is up more than 20% over the past three months. Basically, Wall Street is starting to recognize the positives emerging at UPS.
Still time to jump aboard
Given the deep sell-off in the stock, there's likely still an opportunity for investors to buy UPS. The early gains may have gone to more aggressive value investors, but with business trends looking more positive, there is likely additional upside from here in 2026 as the company's turnaround continues to play out.
