UPS reported lower third-quarter earnings on Tuesday but said online shopping is helping its business. Its narrowed outlook for the year indicates that fourth-quarter earnings will beat Wall Street expectations. UPS now predicts earnings of $4.55 to $4.65 per share, compared with its earlier forecast of $4.50 to $4.70.
On the earnings conference call, CFO Kurt Kuehn was asked why UPS is confident about the fourth quarter.
ANALYST: Can you just talk a little bit, Kurt, about what gives you confidence in the fourth quarter? If I look at the target range, (it) seems like you are almost raising the fourth quarter by a nickel. Are you expecting a break after the election?
KUEHN: No, we're not expecting a significant rebound in the economy, so this outlook is for kind of steady-as-she-goes economic conditions ... I think based just on the progress and the execution across all of the business units, we've adapted to the challenging condition ... international and domestic continue to operate well, albeit in a changing environment. We feel more confident with narrowing the range and clearly being able to deliver in the fourth quarter ... There are several positives out there for the holiday season ... Housing is starting to improve, we have lower fuel costs, lower interest rates, stock market has been strong. That usually correlates to good consumer behavior.