Bank of America cuts UPS price target to $105 after union limits driver buyout program.

Bank of America lowered its price target for UPS stock from $112 to $105, maintaining a Neutral rating, after UPS agreed to limit its Driver Choice buyout program due to a settlement with the International Brotherhood of Teamsters. This restriction means UPS must rely more on natural attrition to reduce its driver workforce, slowing cost savings and tightening margin improvement prospects. Despite this, UPS continues its strategic overhaul with significant cost savings and strong 2025 earnings, aiming for a margin recovery by 2026. Income investors should watch if UPS can meet its operating margin targets amid these new constraints.