UPS shares rise after company posts 7 percent gain in profit

Shares of United Parcel Service Inc. jumped 6.9 percent Wednesday after the delivery company — lifted by higher prices and continuing growth in online shopping — reported a second-quarter profit of $1.49 billion.

UPS said the volume of packages per day grew 3 percent from a year earlier, and revenue per package climbed 4.6 percent.

The Atlanta-based company has been investing in new facilities and more automation to improve reliability, especially during the peak season that runs from Thanksgiving to Christmas, and is also adding technology to help drivers run more efficient routes.

UPS said that second-quarter net income rose 7.3 percent from the $1.38 billion reported a year earlier. Earnings adjusted to exclude non-repeating costs came to $1.94 per share.

That was 2 cents better than the average estimate of 11 analysts surveyed by Zacks Investment Research.

Revenue rose 9.6 percent to $17.46 billion, topping the $17.3 billion forecast from eight analysts surveyed by Zacks.

UPS left unchanged its forecast of full-year adjusted earnings of between $7.03 and $7.37 per share.

The company announced earlier this week that it expects to save about $200 million a year by reducing the number of employees through a buyout offer.

The company's shares rose $7.76 to close at $120.20. The shares are still down 11 percent from their peak in mid-January, when concern about potential competition from Amazon's delivery network and concern about rising costs triggered a major slide in the stock.

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Elements of this story were generated by Automated Insights using data from Zacks Investment Research. Access a Zacks stock report on UPS at https://www.zacks.com/ap/UPS