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Could UPS Be a Turnaround Stock in 2026?
Yahoo Finance· 2026-01-06 17:44
Group 1 - The article discusses a strategy focused on identifying companies with strong operational performance but poor stock price performance, based on the belief that stock prices will eventually revert to the mean [1] - The "Dogs of the Dow" strategy is highlighted, which involves investing in high-yielding dividend stocks within the Dow Jones Industrial Average, capitalizing on the market's overreaction to short-term declines [2] - The article suggests enhancing the Dogs of the Dow strategy by looking for undervalued stocks outside the Dow that are experiencing an uptrend, which can lead to improved returns [4] Group 2 - United Parcel Service (UPS) is presented as an example of a company that has faced stock price declines, with a 20% drop in 2025 and a 40% decrease over the past five years, but has recently begun to trend higher [4][5] - UPS has initiated a turnaround plan called Efficiency Reimagined, which includes closing 73 facilities and reducing its reliance on Amazon, aiming to cut $3.5 billion in annual costs through investments in AI and automation [6] - The company's Q3 2025 earnings report showed revenue of $21.4 billion, a 3.7% year-over-year decrease, but diluted earnings per share exceeded analyst expectations by 34%, and operating margin improved to 10% from 7.7% earlier in the year [8]