United Parcel Service, the world's largest package delivery company, reported a quarterly profit that beat estimates and forecast record-high profits in 2011, sending its shares up nearly 3 percent on Tuesday in premarket trading.
In less than two years from the recession, they already think they can exceed peak earnings, said BB&T analyst Kevin Sterling.
The economic bellwether's fourth-quarter adjusted operating profit rose to $1.08 per share, up 44 percent from a year ago and topping the $1.05 per share expected by analysts, according to Thomson Reuters I/B/E/S.
This is a combination of strong volumes, which are clearly a good indication for the U.S. and even the global economy, but also tells me that UPS is really getting pricing and all that pricing leverage is flowing through to the bottom line, he said.
The 3 cent-per-share difference largely reflected a gain from the sale of a logistics unit.
Revenue rose to $13.42 billion from $12.38 billion.
UPS handles 6 percent of the U.S. GDP and 2 percent of global GDP in its trucks and planes, the company said, so its shipment trends give a tangible picture of consumer demand.
The company revised its 2011 profit forecast upward to a range of $4.12 to $4.35 a share, up 16 percent to 22 percent from its 2010 adjusted results, which would surpass its prior peak earnings set in 2007.
UPS's shares have gained about 20 percent in the past year. That tops the rise of 14.4 percent for FedEx Corp, the second- largest package delivery company, but lags the 27 percent gain in the Dow Jones Transportation Average .
FedEx Corp shares rose nearly 2 percent in premarket trading. FedEx in December also raised its fiscal full-year outlook on record holiday shipments, business in Asia and growth from emerging markets.
(Reporting by Lynn Adler, editing by Maureen Bavdek)