Experts Highlight UPS Stock with 5.8% Dividend Yield
Shares of large companies are better protected against pressure from bonds and other fixed-income instruments.
UPS's forward dividend yield stands at 5.8%. High-yield stocks of large companies are better protected against pressure from bonds and other fixed-income instruments.
In recent years, UPS has seen declines in its average daily package volume and adjusted operating margin. Results have been impacted by a slowdown in online orders post-pandemic, competition, inflation, and rising costs following a new agreement with the Teamsters union. The company has also reduced low-margin deliveries for Amazon.
In return, UPS has gained more high-margin orders from small businesses and healthcare clients, reduced its workforce, and expanded logistics automation. For 2026, the company expects revenue growth to $92.6 billion and adjusted earnings per share to reach $7.28.
UPS has increased dividends annually for 16 consecutive years. Over the past 12 months, payouts have amounted to 85% of free cash flow. The author considers the company one of the few high-yield options within the S&P 500 that are still worth buying.
