Morgan Stanley lowered its investment rating on United Parcel Service ( UPS) to equal-weight from overweight Monday, citing valuation concerns and a belief that the company has less upside potential than railroad and trucking companies.

The brokerage still finds the stock more attractive in the near term than rival shipper FedEx ( FDX), but believes that its valuation is beginning to get stretched relative to the S&P 500.

UPS shares were down 1% to $64.60 in the premarket. The shares are trading at a price-to-earnings ratio of about 31.

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