United Parcel Service, Inc. (NYSE:UPS) reported its Q1 results, with both EPS of $3.05 and revenue of $24.4 billion coming in better than the consensus estimates of $2.88 and $23.79 billion, respectively.

Despite a solid beat, the company recorded its weakest EBIT growth since mid-2020 as the pressure of tough comps, weaker e-commerce demand and rising costs started to tell.

Analysts at Berenberg Bank expect these issues to intensify in the coming quarters, but think that pricing strength should enable management to offset most of these headwinds. The shares have underperformed in the past month but have not fully de-rated. Given the shares are usually comparatively resilient in weak markets, analysts think further downside from here is probably limited, but equally, in the face of high levels of demand uncertainty, the stock lacks upside catalysts from here. They maintained their hold rating and $200 price target on the company’s shares.