We recently published a list of 11 Blue Chip Stocks to Invest in at 52-Week Lows. In this article, we are going to take a look at where United Parcel Service, Inc. (NYSE:UPS) stands against other blue chip stocks to invest in at 52-week lows.
For the first time since 2023, the S&P 500 was seen in the market correction territory, according to US Bank (Wealth Management). The rapid fall surprised several investors, mainly considering the favorable underlying conditions US stocks carried into 2025. The broader markets are reacting primarily to the potential economic consequences of the Trump administration’s policies. Most critical are the new trade policies focused on raising tariffs for goods imported to the US. According to Rob Haworth, senior investment strategy director with U.S. Bank Asset Management, the uncertainty remains the key driver around the market’s recent decline. There are increased concerns related to the potential economic weakness, mainly because of tariff impacts.
Sector Performance in 2025
As per US Bank (Wealth Management), in 2023 and 2024, stocks were aided by consistent economic growth as technology stocks dominated the broader market performance. The revenues of technology companies were aided by significant spending on AI-related investment. As per Haworth, it is of utmost importance for other sectors to make increased earnings contributions. In the early months of 2025, there was a shift in investor sentiment. The sectors that supported the prior year’s market performance, i.e., IT, communication services, and consumer discretionary, have been dragging the market down.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
Underlying Fundamentals Remain Strong
US Bank (Wealth Management) stated that the markets fluctuated through most of Q1 2025. That being said, by February 19, the S&P 500 gained 4.5%, says the firm. Furthermore, the firm added that YTD through March 17, the broader S&P 500’s total return was down 3.23%. This comes after 2 years of 25%+ S&P 500 total returns. Despite the uncertainty, for the time being, many underlying fundamentals remain positive. According to Eric Freedman, chief investment officer for U.S. Bank Asset Management, the consumers remain in a good spot, and companies are flush with cash.
As per Haworth, while US markets were impacted in Q1 2025, global stocks delivered positive returns. In the current environment, Haworth believes that a globally diversified portfolio places the investors in a position to capitalize on numerous opportunities. Notably, investors tend to respond to the perceived potential corporate earnings based on specific policies or events. Even though there have been struggles in early 2025, most of the underlying data is favorable.
Our Methodology
To list the 11 Blue Chip Stocks to Invest in at 52-Week Lows, we sifted through the holdings of SPDR S&P 500 ETF Trust and shortlisted the stocks trading close to their respective 52-week lows. Next, we mentioned hedge fund sentiments around each stock, as of Q4 2024. Finally, the stocks were arranged in ascending order of their hedge fund sentiments.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A warehouse filled with boxes of parcels, symbolizing the companies reliable logistics services.
United Parcel Service, Inc. (NYSE:UPS)
Stock Price as of March 25: $109.95
52-week Low: $109.4
Number of Hedge Fund Holders: 59
United Parcel Service, Inc. (NYSE:UPS) is a package delivery and logistics provider that provides transportation and delivery services. The cyclical recovery in the transportation sector is expected to offer significant tailwinds for the company. With the economic activity picking up, there seems to be an increase in both B2B and B2C shipping volumes. This increase in demand can enable United Parcel Service, Inc. (NYSE:UPS) to better utilize the network capacity, improving operational efficiency and potentially fueling margins. Also, a recovery in the economy often results in higher industrial production and trade, which can fuel growth for the company.
United Parcel Service, Inc. (NYSE:UPS)’s global network and comprehensive service offerings place the company well to capitalize on an overall economic recovery. For FY 2025, on a consolidated basis, the company anticipates revenue to be ~$89.0 billion and an operating margin of ~10.8%. The company’s strategic investments, primarily in the SMB market and healthcare logistics, can fuel significant long-term growth. United Parcel Service, Inc. (NYSE:UPS) announced that it has completed the acquisition of Frigo-Trans and its sister company BPL, which offer industry-leading, complex healthcare logistics solutions throughout Europe.
Artisan Partners, an investment management company, released its Q3 2024 investor letter. Here is what the fund said:
“We made no new purchases in Q3. Instead, our purchase activity was focused on adding to a few of our existing names that remain cheap, such as Dollar General and United Parcel Service, Inc. (NYSE:UPS). When we initiated our position in UPS in late 2023, shares were under pressure due to concerns about its new labor contract diverting volumes and driving up costs, as well as the continued normalization of volumes following COVID-related gains. We welcomed the market’s short-term focus as it provided us an opportunity to purchase UPS at an undemanding valuation of less than 11X our view of normalized earnings. UPS is a good transport operation that easily earns its cost of capital, generates significant free cash, has a wide economic moat, has a strong financial profile and pays an attractive dividend—now yielding 4.8%. More recently, the stock has been weak because profits came in weaker than expected. UPS’ customers traded down to the lower yielding ground segment, which negatively impacted overall pricing and margins. These shifts are common and occur in both directions, but what is important, in our view, is the long-term trend of volume growth remains intact. Nevertheless, investors have lost patience with UPS after a string of earnings disappointments.”
Overall, UPS ranks 6th on our list of blue chip stocks to invest in at 52-week lows. While we acknowledge the potential of UPS as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued AI stock that is more promising than UPS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
