US Supreme Court Rules IEEPA Tariffs Illegal, Impacting Billions in Refunds
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 20 2026
0mins
Source: CNBC
- Refund Challenges: The US Supreme Court's ruling that Trump's IEEPA tariffs are illegal could lead to billions in refund requests, but trade attorneys warn that the refund process may be delayed due to court rulings and customs payment methods, creating double hurdles for importers.
- Surge in Tariff Revenue: The US government recorded $30 billion in tariff revenue in January 2026, bringing the year-to-date total to $124 billion, a staggering 304% increase year-over-year, indicating significant short-term fiscal impacts from high tariff policies, while potential refunds could exert long-term pressure on the Treasury.
- Customs Bond Issues: The rise in tariffs has escalated importers' customs bond requirements from a minimum of $50,000 to as high as $450 million, resulting in over 24,000 cases of bond insufficiencies valued at nearly $3.6 billion, highlighting the substantial cash flow impact of tariff policies on businesses.
- Complexity of Refund Process: Although tariffs are itemized, theoretically allowing for quick refunds, insurance companies require document verification, leading to expected delays of 30 to 60 days for refunds, particularly as small businesses have begun reaching out to insurers ahead of the Supreme Court decision to expedite the review process.
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Analyst Views on UPS
Wall Street analysts forecast UPS stock price to fall
19 Analyst Rating
9 Buy
9 Hold
1 Sell
Moderate Buy
Current: 109.540
Low
80.00
Averages
107.06
High
126.00
Current: 109.540
Low
80.00
Averages
107.06
High
126.00
About UPS
United Parcel Service, Inc. is a global package delivery and logistics provider. Its U.S. Domestic Package segment offers a full spectrum of air and ground package transportation services. Its air portfolio offers time-definite, same-day, next-day, two-day and three-day delivery alternatives as well as air cargo services. Its ground network enables customers to ship using its day-definite ground service. Ground Saver provides residential ground service for customers with non-urgent, lightweight residential shipments. Its International Package segment consists of small package operations in Europe, Middle East and Africa, Canada and Latin America and Asia. It offers a selection of guaranteed day and time-definite international transportation services supported by its brokerage capabilities that facilitate cross-border clearance for international shipments. Its supply chain solutions consist of customized third-party logistics and specialized cold chain transportation solutions.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
UPS Invests $48 Million to Upgrade Facilities
- Strategic Investment: UPS plans to invest $48 million in 27 temperature-controlled facilities to meet the growing demand for low-temperature medication transport, particularly GLP-1 weight-loss drugs, highlighting the company's strategic focus on the healthcare sector.
- Business Transformation: Despite a 50% drop in stock price from its 2022 peak, UPS is undergoing a massive business overhaul aimed at enhancing operational efficiency through modernization, although this may lead to short-term revenue declines and increased costs.
- Customer Focus: UPS is shifting from low-margin customers to high-margin ones, particularly in the healthcare sector, which is expected to yield higher profit margins and growth opportunities, reflecting the company's emphasis on future profitability.
- Market Reaction: Although investors remain cautious about UPS's turnaround, resulting in a high 6% dividend yield, the $48 million investment indicates a long-term strategic effort towards growth, potentially leading to a business inflection point in the second half of 2026.
See More
UPS Invests $48 Million in Temperature-Controlled Facilities
- Business Transformation Investment: UPS has announced a $48 million investment in 27 temperature-controlled facilities to meet the rising demand for low-temperature medication transport, particularly GLP-1 weight-loss drugs, thereby enhancing its market share and profit margins in the healthcare sector.
- Customer Focus Strategy: The company is shifting from low-margin high-volume customers to high-margin clients, which has led to a decline in overall revenue; however, revenue per package is increasing, indicating early signs of success, with management projecting a turnaround inflection point in the second half of 2026.
- Market Reaction and Dividends: Despite UPS's stock price dropping 50% from its 2022 peak, its 6% dividend yield reflects investor concerns about the turnaround, while also indicating market expectations for future growth potential.
- Long-term Strategic Significance: By investing in temperature-controlled facilities, UPS is not only enhancing service quality but also laying the groundwork for future growth, particularly in high-margin opportunities within the healthcare sector, signaling a potential shift from business contraction to expansion.
See More
Jim Cramer Increases FedEx Holdings
- Increased Holdings: Jim Cramer's Charitable Trust purchased 130 shares of FedEx shortly after the market opened, raising its total holdings to 230 shares and increasing its portfolio weight from 0.75% to 1.75%, reflecting confidence in FedEx's future performance.
- Earnings Beat: FedEx's latest earnings report exceeded analyst expectations, with both revenue and adjusted earnings per share (EPS) performing well, although management's guidance was complicated by the company's restructuring, impacting investor assessments.
- Future Outlook: FedEx guided for adjusted EPS in the range of $16.90 to $18.10 for calendar year 2026, slightly below some analysts' expectations, yet management anticipates a 20% year-over-year growth during the transition period, showcasing strong business momentum.
- Margin Impact: CEO Raj Subramaniam noted that excluding fuel surcharges would have led to year-over-year margin increases, despite the surcharges negatively affecting profits and making reported results appear softer than their true nature.
See More
FedEx Shares Drop 7% Amid Margin Squeeze Concerns
- Profit Pressure Emerges: FedEx's operating margin in its core delivery segment fell to 7.7% from 8.4% a year earlier, primarily due to rising employee salaries, benefits, and outsourced transportation and fuel costs, intensifying investor concerns about the company's profitability.
- Impact of Business Restructuring: The recent spinoff of its highly profitable trucking unit, FedEx Freight, aims to refocus on delivery operations, yet this transition has raised market scrutiny regarding its future profitability, particularly in the current economic climate.
- Market Environment Challenges: FedEx and U.S. logistics firms like UPS are grappling with declining volumes due to changing U.S. trade policies and rising fuel prices from the Iran conflict, compounded by the loss of duty-free treatment for low-value e-commerce shipments linked to Chinese sellers, further impacting volumes.
- Uncertain Future Outlook: FedEx forecasts annual earnings between $16.90 and $18.10 per share, but analysts have yet to develop models for comparison with the new forecast, making it difficult to assess performance over the next few quarters, especially as the company shifts to align its fiscal year with the calendar year.
See More
FedEx Reports Strong Quarter but Shares Slide Post Earnings
- Strong Earnings Report: FedEx reported $25 billion in revenue for Q4 FY2026, surpassing the $24.04 billion consensus forecast, with EPS rising 4% to $6.31, exceeding expectations of $5.96, indicating robust performance in both revenue and profitability.
- Margin Compression: Despite the strong revenue and earnings, the operating margin was reported at 8.35%, below the expected 8.44%, raising investor concerns about future earnings guidance, which contributed to the stock's decline in after-hours trading.
- Fuel Surcharge Dynamics: FedEx's strategy of passing fuel costs to customers through surcharges resulted in a 5% revenue increase, but since these surcharges carry a 0% profit margin, overall margins were compressed, highlighting the challenges the company faces in managing rising costs.
- Conservative Future Guidance: Management forecasts earnings between $16.90 and $18.10 per share, which some analysts may view as conservative; however, the projected 11% revenue growth remains solid, reflecting the company's ongoing potential for growth in premium markets.
See More
FedEx Projects 11% Revenue Growth Amid Operational Changes
- Revenue Growth Outlook: FedEx anticipates approximately 11% revenue growth for the upcoming year, with earnings per share projected between $16.90 and $18.10, reflecting strong financial performance bolstered by increased shipping rates.
- Fiscal Year Adjustment: The company is aligning its fiscal year with the calendar year, previously ending on May 31, aiming to enhance financial transparency and operational efficiency through this strategic shift.
- Impact of Business Spin-off: Following the spin-off of its freight trucking unit on June 1, FedEx reported an adjusted earnings per share of $6.31 for the quarter, up from $6.07 a year earlier, indicating the effectiveness of its operational streamlining efforts.
- Market Challenges and Opportunities: Despite challenges from changing U.S. trade policies affecting low-value e-commerce shipments from China, FedEx's core express segment saw a 14% revenue increase, highlighting its potential in the premium overnight delivery market.
See More
UPS Invests $48 Million to Upgrade Facilities
- Strategic Investment: UPS plans to invest $48 million in 27 temperature-controlled facilities to meet the growing demand for low-temperature medication transport, particularly GLP-1 weight-loss drugs, highlighting the company's strategic focus on the healthcare sector.
- Business Transformation: Despite a 50% drop in stock price from its 2022 peak, UPS is undergoing a massive business overhaul aimed at enhancing operational efficiency through modernization, although this may lead to short-term revenue declines and increased costs.
- Customer Focus: UPS is shifting from low-margin customers to high-margin ones, particularly in the healthcare sector, which is expected to yield higher profit margins and growth opportunities, reflecting the company's emphasis on future profitability.
- Market Reaction: Although investors remain cautious about UPS's turnaround, resulting in a high 6% dividend yield, the $48 million investment indicates a long-term strategic effort towards growth, potentially leading to a business inflection point in the second half of 2026.
See More
UPS Invests $48 Million in Temperature-Controlled Facilities
- Business Transformation Investment: UPS has announced a $48 million investment in 27 temperature-controlled facilities to meet the rising demand for low-temperature medication transport, particularly GLP-1 weight-loss drugs, thereby enhancing its market share and profit margins in the healthcare sector.
- Customer Focus Strategy: The company is shifting from low-margin high-volume customers to high-margin clients, which has led to a decline in overall revenue; however, revenue per package is increasing, indicating early signs of success, with management projecting a turnaround inflection point in the second half of 2026.
- Market Reaction and Dividends: Despite UPS's stock price dropping 50% from its 2022 peak, its 6% dividend yield reflects investor concerns about the turnaround, while also indicating market expectations for future growth potential.
- Long-term Strategic Significance: By investing in temperature-controlled facilities, UPS is not only enhancing service quality but also laying the groundwork for future growth, particularly in high-margin opportunities within the healthcare sector, signaling a potential shift from business contraction to expansion.
See More
Jim Cramer Increases FedEx Holdings
- Increased Holdings: Jim Cramer's Charitable Trust purchased 130 shares of FedEx shortly after the market opened, raising its total holdings to 230 shares and increasing its portfolio weight from 0.75% to 1.75%, reflecting confidence in FedEx's future performance.
- Earnings Beat: FedEx's latest earnings report exceeded analyst expectations, with both revenue and adjusted earnings per share (EPS) performing well, although management's guidance was complicated by the company's restructuring, impacting investor assessments.
- Future Outlook: FedEx guided for adjusted EPS in the range of $16.90 to $18.10 for calendar year 2026, slightly below some analysts' expectations, yet management anticipates a 20% year-over-year growth during the transition period, showcasing strong business momentum.
- Margin Impact: CEO Raj Subramaniam noted that excluding fuel surcharges would have led to year-over-year margin increases, despite the surcharges negatively affecting profits and making reported results appear softer than their true nature.
See More
FedEx Shares Drop 7% Amid Margin Squeeze Concerns
- Profit Pressure Emerges: FedEx's operating margin in its core delivery segment fell to 7.7% from 8.4% a year earlier, primarily due to rising employee salaries, benefits, and outsourced transportation and fuel costs, intensifying investor concerns about the company's profitability.
- Impact of Business Restructuring: The recent spinoff of its highly profitable trucking unit, FedEx Freight, aims to refocus on delivery operations, yet this transition has raised market scrutiny regarding its future profitability, particularly in the current economic climate.
- Market Environment Challenges: FedEx and U.S. logistics firms like UPS are grappling with declining volumes due to changing U.S. trade policies and rising fuel prices from the Iran conflict, compounded by the loss of duty-free treatment for low-value e-commerce shipments linked to Chinese sellers, further impacting volumes.
- Uncertain Future Outlook: FedEx forecasts annual earnings between $16.90 and $18.10 per share, but analysts have yet to develop models for comparison with the new forecast, making it difficult to assess performance over the next few quarters, especially as the company shifts to align its fiscal year with the calendar year.
See More
FedEx Reports Strong Quarter but Shares Slide Post Earnings
- Strong Earnings Report: FedEx reported $25 billion in revenue for Q4 FY2026, surpassing the $24.04 billion consensus forecast, with EPS rising 4% to $6.31, exceeding expectations of $5.96, indicating robust performance in both revenue and profitability.
- Margin Compression: Despite the strong revenue and earnings, the operating margin was reported at 8.35%, below the expected 8.44%, raising investor concerns about future earnings guidance, which contributed to the stock's decline in after-hours trading.
- Fuel Surcharge Dynamics: FedEx's strategy of passing fuel costs to customers through surcharges resulted in a 5% revenue increase, but since these surcharges carry a 0% profit margin, overall margins were compressed, highlighting the challenges the company faces in managing rising costs.
- Conservative Future Guidance: Management forecasts earnings between $16.90 and $18.10 per share, which some analysts may view as conservative; however, the projected 11% revenue growth remains solid, reflecting the company's ongoing potential for growth in premium markets.
See More
FedEx Projects 11% Revenue Growth Amid Operational Changes
- Revenue Growth Outlook: FedEx anticipates approximately 11% revenue growth for the upcoming year, with earnings per share projected between $16.90 and $18.10, reflecting strong financial performance bolstered by increased shipping rates.
- Fiscal Year Adjustment: The company is aligning its fiscal year with the calendar year, previously ending on May 31, aiming to enhance financial transparency and operational efficiency through this strategic shift.
- Impact of Business Spin-off: Following the spin-off of its freight trucking unit on June 1, FedEx reported an adjusted earnings per share of $6.31 for the quarter, up from $6.07 a year earlier, indicating the effectiveness of its operational streamlining efforts.
- Market Challenges and Opportunities: Despite challenges from changing U.S. trade policies affecting low-value e-commerce shipments from China, FedEx's core express segment saw a 14% revenue increase, highlighting its potential in the premium overnight delivery market.
See More
