Investing
UPS Boosts High-Yield Dividend to $1.64 And Paid Investors Today
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United Parcel Service (NYSE:UPS) is a dividend-paying powerhouse, and paid a quarterly dividend of $1.64 per share to shareholders today, March 6. Anyone owning shares as of February 18, 2025, will pocket this market beating 5.5% yield payment. This payout continues UPS’s 26-year streak of maintaining or boosting its dividend since going public in 1999, making it a stable pick for income investors.
Key Points
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UPS delivers another reliable dividend payment with a 5.5% yield.
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The company has maintained or increased its dividend for 26 straight years.
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Just Shy of Dividend Aristocrat
UPS isn’t an official Dividend Aristocrat—reserved for S&P 500 firms with 25+ years of consecutive increases—but it’s knocking on the door with 26 years of steady or rising payouts since 1999.
The current $1.64 quarterly dividend annualizes to $6.56, yielding about 5.5% based on a recent $120 stock price. Since 2014, the dividend has climbed roughly 140%, paired with a 22% increase in share price. While the total stock return has significantly underperformed the S&P 500 (223% vs. 18% over the last 10 years), dividend payments have been growing each year.
CFO Brian Dykes, during the Q4 2024 earnings call hinted at “continued commitment” to the dividend, targeting a payout ratio around 50–60%.
Why Investors Like Dividends
Dividend stocks like UPS hold broad appeal for investors and retirees alike. Studies show that from 1980 to 2019, dividends fueled 75% of the S&P 500’s total returns, blending capital gains with steady income for long-term wealth.
With the S&P 500 down close to 5% over the past month and tariffs spooking investors, dividend stocks hold extra allure to defensive minded investors looking to project their portfolio. Per Ned Davis Research, dividend stocks outperformed non-payers by 60% during bear markets (1970–2020), acting as a cushion in rocky times.
That 5.5% yield from UPS, outpacing the current 3% U.S. inflation rate, delivers reliable cash flow, making it a haven for those seeking protection amid market turbulence.
What Wall Street Expects of UPS
Analysts are cautiously optimistic. The consensus price target from 31 Wall Street analysts now stands at $132.56, about 11.3% above the current $119.15 stock price, with a wide range of expectations—targets stretch from a high of $179 to a low of $82.
Ratings average a 2.06 out of 5, translating to a solid “Outperform” and growth projections are mixed—long-term growth is pegged at 3.70%, but industrial volatility and a projected 8.5% U.S. volume drop in 2025 due to reduced business with its largest customer temper expectations. Still, CEO Carol Tomé’s focus on a 12% U.S. operating margin by Q4 2026 signals upside for patient investors.
$10,000 Investment in UPS 10 Years Ago
To showcase the power of a dividend stock like UPS, let’s look at a $10,000 investment from March 2015 with dividends reinvested. That $10,000 bought 99 shares at $98 each, but after 10 years, reinvested dividends grew it to 139 shares. The annualized return was 5.14%, with dividend value exceeding $4,680—proof of compounding magic.
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