Benzinga | Nov 29, 2021 09:11AM EST

Deutsche Bank Now Prefers FedEx, Downgrades UPS To Hold

* Deutsche Bank analyst Amit Mehrotra downgraded United Parcel Service, Inc. (NYSE:UPS) to Hold from Buy and lowered the price target to $221 (an upside of 7.63%) from $253.

* Mehrotra mentions, after the 120% increase in shares since the upgrade to Buy 21 months ago, the stock's risk/reward is better balanced.

* The analyst now prefers FedEx Corp (NYSE:FDX) over UPS, given the former's "severe" underperformance year-to-date and UPS's upcoming renegotiation with its union.

* The upcoming contract negotiation between UPS and the Teamsters "has potential to be the most tumultuous since the 15-day UPS work stoppage in 1997," Mehrotra contends.

* In September 2021, Deutsche Bank lowered FedEx's price target to $280 from $375 and maintained a Buy rating on the shares.

* Also read, Low Teamsters Election Turnout May Not Be What it Seems.

* Price Action: UPS shares are trading lower by 0.29% at $204.70 and FDX higher by 1.20% at $241.00 during the pre-market session on Monday.