(Reuters) -United Parcel Service Inc shares fell 6% on Wednesday as the company known for delivering everything from Amazon.com (NASDAQ:) packages to coronavirus vaccines laid out plans to prioritize lucrative deliveries over volume.
Executives issued growth forecasts largely inline with Wall Street estimates on Wednesday, and said they planned to capture more business from healthcare and small and medium-sized businesses.
Shares in UPS, which have nearly doubled in value over the last year, dropped $12.62 to $197.14 in midday trading.
“Not all packages are attractive to us,” Chief Executive Carol Tome said on the company’s investor day webcast.
Tome said growth from small and medium-sized businesses would outpace those from large customers, including Amazon, its No. 1 client.
Amazon and other large e-commerce companies have muscle to negotiate lower shipping rates than small businesses. Healthcare deliveries, including temperature-monitored shipments from companies like vaccine maker Pfizer Inc (NYSE:), are among the most profitable in the business.
Atlanta-based UPS forecast full-year revenue between $98 billion to $102 billion for 2023, compared with the average analyst estimate of $100.19 billion, according to Refinitiv data. It reported a full-year revenue of $84.6 billion in 2020.
Executives at the company also said it would selectively buy back shares.
UPS now plans to be carbon-neutral across its global operations by 2050.
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