May 14, 2018 / 2:12 PM / 6 months ago

BUZZ-UPS: BofA Merrill raises to "buy", ups PT

** Package delivery company shares up 2 pct at $117.85 in early trading

** BofA Merrill upgrades stock to “buy” from “neutral,” citing additional earnings upside from network transformation projects

** Says launch of network transformation plan could be turning point for UPS much in the way FedEx’s (rated “buy”) profit improvement plan in 2013 focused the company on improving margins and rejecting non-compensatory ecommerce business

** Says has increased confidence in the plan, which could focus on improving margins throughout the organization and will strive to reduce costs

** Based on operating income target of $7.6 bln in 2018 and $8.4 bln in 2019, BofA Merrill forecasts 10 pct y-o-y growth

** BofA raises PT by $24 to $144, highest on the Street and a potential 25 pct upside to Friday’s close; median PT $124.50

** 9 of 27 brokerages rate UPS “buy” or higher, 16 “hold” and 2 “sell” or lower

** Stock up ~11 pct in last 12 months (Reporting by Brijesh Patel in Bengaluru)

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