American multinational logistics giant United Parcel Service (UPS) has extended its cloud deal with Google (GOOGL) as its data analytics needs grow. It counts on the arrangement to increase its operational efficiencies and improve customers’ experience.
Google is among the world’s top cloud vendors, along with Amazon (AMZN) and Microsoft (MSFT). UPS has been using Google cloud resources for various functions. For example, Google Cloud powers its Harmonized Enterprise Analytics Tool (HEAT) platform, which provides insight into how packages move through the logistics network.
The cloud technology also enhances how UPS gives customers control over their deliveries. The company is going to use more Google cloud resources in the expanded deal.
UPS Chief Information and Engineering Officer, Juan Perez, said, “UPS harnesses massive amounts of data from throughout its Global Smart Logistics Network to provide our customers with unmatched service.”
More Data to Analyze as Packages Get Tracking Chips
UPS is seeking greater analytical capabilities by expanding its use of Google Cloud. According to the Wall Street Journal, the logistics giant has more data to analyze now that it is equipping packages with identification chips. UPS delivered more than 25 million packages a day in 2021, compared to 24.7 million packages delivered a day the previous year, according to the Journal.
Reducing Carbon Emissions
The efficiencies that come from the use of cloud technology also contribute to UPS’s sustainability efforts. The company explains that Google’s analytics expertise enables it to optimize delivery routes to reduce fuel consumption, which in turn helps lower its carbon emissions.
Wall Street’s Take
The Street is cautiously optimistic about UPS stock with a Moderate Buy consensus rating. That’s based on 11 Buys, eight Holds, and one Sell. The average UPS price target of $241.35 implies 9.91% upside potential to current levels. Shares have increased 24% over the past six months.
Blogger Opinions:
TipRanks data shows that financial blogger opinions are 96% Bullish on UPS, compared to a sector average of 69%.
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