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Why Shares in UPS Fell Today

TheMotleyFool

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Shares in package delivery giant UPS (NYSE: UPS) fell by more than 2% in early trading today. The move comes after an analyst from a heavyweight firm, Citi's Christian Wetherbee, recommended buying the transportation stock.

A buy recommendation is never bad, but the context is important here. Wetherbee is recommending a so-called "pair trade," whereby investors buy UPS and short FedEx. In other words, even if UPS stock falls, FedEx will likely fall even more, and investors will still make money from the trade.

Wetherbee's rationale is that the deteriorating macroeconomic environment will lead to weakening volumes at FedEx and UPS, and the latter is better positioned to deal with it.

Source Fool.com

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