Deutsche Bank said in a note Monday that it sees a potential "handshake" deal between United Parcel Service Inc (NYSE:UPS) and Teamsters relatively soon.
The two sides have been in discussions for two months regarding a potential employee strike, with Teamsters representing UPS rank-and-file employees.
Deutsche Bank analysts said, "There have been several positive developments in the last few days related to the ongoing negotiations between UPS and the Teamsters."
"The bottom line is we think the two sides are close, and we see potential for a "handshake" deal relatively soon," stated the analysts, who have a Buy rating on UPS.
On Friday, the Teamsters issued a press release saying UPS has pledged to reach a deal no later than July 5. The analysts said that while negotiations are still pending and more tough talk is expected, they continue to think that the two sides are not that far apart and "a strike is now highly unlikely."
"We continue to like the near, mid and long term prospects for UPS shares," the analysts wrote. "We previewed the company's 2Q results positively in our 2Q preview from two weeks ago, and we think the aforementioned progress on talks can refocus market participants on the strong execution in the face of weaker volumes."