Wall Street has been warming to both stocks as pricing and volumes for parcel shippers have risen throughout the pandemic.

Group is encouraged by pricing gains. “It has become clearer to us that the parcel companies are seeing tremendous pricing power, which is in turn finally leading to significant [profit] margin improvement,” he wrote in a research report. “We have finally reached a tipping point for the parcel companies with the step-function growth in e-commerce demand over the past year and new management at UPS.”

The tipping point means better free cash flow and valuation multiples down the road.

Many of Group’s peers appear to be coming around to his view. Right now, more than 70% of analysts covering FedEx rate shares Buy. A year ago, the Buy-rating ratio was closer to 50%. The average Buy-rating ratio for stocks in the S&P 500 is roughly 55%.

The average analyst price target is about $325, or 12% higher than recent trading levels. A year ago, the average analyst price target was about $140 a share.

UPS isn’t as popular with analysts as FedEx. Just over 50% covering the company rate shares Buy. About a year ago, about 40% of analysts rated shares Buy.

The average analyst price target is about $210, about 3% higher than recent levels. A year ago, the average analyst price target was about $100 a share.

Valuation might be a reason for the different takes. UPS is trading for roughly 19 times estimated 2021 earnings; FedEx is trading for less than 17 times.

FedEx is more popular with the Street, but UPS stock has the upper hand in 2021— and is up 26% year to date, jumping 10% on April 27 after it reported blowout first quarter numbers. FedEx stock is up about 17% year to date, better than gains of the S&P 500 and the Dow industrials.

Both stocks had a great 2020. UPS share rose about 44%; FedEx stock gained about 72%.

Write to Al Root at allen.root@dowjones.com