UNITED PARCEL SERVICE-CL B (UPS) Stock Fundamental Analysis
NYSE:UPS - New York Stock Exchange, Inc. - US9113121068 - Common Stock - Currency: USD
UPS gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 22 industry peers in the Air Freight & Logistics industry. UPS has an excellent profitability rating, but there are some minor concerns on its financial health. UPS has a valuation in line with the averages, but on the other hand it scores bad on growth. UPS also has an excellent dividend rating. These ratings would make UPS suitable for dividend investing!
1. Profitability
1.1 Basic Checks
In the past year UPS was profitable.
In the past year UPS had a positive cash flow from operations.
Each year in the past 5 years UPS has been profitable.
Each year in the past 5 years UPS had a positive operating cash flow.
1.2 Ratios
The Return On Assets of UPS (8.55%) is better than 81.82% of its industry peers.
UPS has a better Return On Equity (37.39%) than 95.45% of its industry peers.
UPS has a Return On Invested Capital of 12.73%. This is amongst the best in the industry. UPS outperforms 81.82% of its industry peers.
The Average Return On Invested Capital over the past 3 years for UPS is above the industry average of 12.73%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.55% | ||
| ROE | 37.39% | ||
| ROIC | 12.73% |
ROA(3y)11.32%
ROA(5y)10.94%
ROE(3y)43.9%
ROE(5y)85.31%
ROIC(3y)15.05%
ROIC(5y)15.77%
1.3 Margins
Looking at the Profit Margin, with a value of 6.44%, UPS belongs to the top of the industry, outperforming 86.36% of the companies in the same industry.
UPS's Profit Margin has been stable in the last couple of years.
With an excellent Operating Margin value of 9.48%, UPS belongs to the best of the industry, outperforming 86.36% of the companies in the same industry.
UPS's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 80.82%, UPS belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
UPS's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.48% | ||
| PM (TTM) | 6.44% | ||
| GM | 80.82% |
OM growth 3Y-10.47%
OM growth 5Y-2.2%
PM growth 3Y-21.75%
PM growth 5Y1.16%
GM growth 3Y1.64%
GM growth 5Y0.43%
2. Health
2.1 Basic Checks
UPS has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, UPS has about the same amount of shares outstanding.
Compared to 5 years ago, UPS has less shares outstanding
Compared to 1 year ago, UPS has an improved debt to assets ratio.
2.2 Solvency
UPS has an Altman-Z score of 3.18. This indicates that UPS is financially healthy and has little risk of bankruptcy at the moment.
UPS has a Altman-Z score of 3.18. This is comparable to the rest of the industry: UPS outperforms 59.09% of its industry peers.
UPS has a debt to FCF ratio of 3.98. This is a good value and a sign of high solvency as UPS would need 3.98 years to pay back of all of its debts.
The Debt to FCF ratio of UPS (3.98) is better than 72.73% of its industry peers.
A Debt/Equity ratio of 1.25 is on the high side and indicates that UPS has dependencies on debt financing.
UPS's Debt to Equity ratio of 1.25 is on the low side compared to the rest of the industry. UPS is outperformed by 72.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.25 | ||
| Debt/FCF | 3.98 | ||
| Altman-Z | 3.18 |
ROIC/WACC1.64
WACC7.74%
2.3 Liquidity
UPS has a Current Ratio of 1.09. This is a normal value and indicates that UPS is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of UPS (1.09) is worse than 72.73% of its industry peers.
UPS has a Quick Ratio of 1.09. This is a normal value and indicates that UPS is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.09, UPS is not doing good in the industry: 68.18% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
UPS shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -2.75%.
UPS shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 0.53% yearly.
Looking at the last year, UPS shows a small growth in Revenue. The Revenue has grown by 1.30% in the last year.
Measured over the past years, UPS shows a small growth in Revenue. The Revenue has been growing by 4.21% on average per year.
EPS 1Y (TTM)-2.75%
EPS 3Y-13.95%
EPS 5Y0.53%
EPS Q2Q%4.2%
Revenue 1Y (TTM)1.3%
Revenue growth 3Y-2.18%
Revenue growth 5Y4.21%
Sales Q2Q%-0.74%
3.2 Future
Based on estimates for the next years, UPS will show a small growth in Earnings Per Share. The EPS will grow by 7.12% on average per year.
The Revenue is expected to grow by 2.35% on average over the next years.
EPS Next Y-8.01%
EPS Next 2Y2.08%
EPS Next 3Y4.64%
EPS Next 5Y7.12%
Revenue Next Year-4.28%
Revenue Next 2Y-1.77%
Revenue Next 3Y0.14%
Revenue Next 5Y2.35%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 13.41, the valuation of UPS can be described as correct.
Based on the Price/Earnings ratio, UPS is valued a bit cheaper than 77.27% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.21. UPS is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio of 12.97, the valuation of UPS can be described as correct.
Compared to the rest of the industry, the Price/Forward Earnings ratio of UPS indicates a rather cheap valuation: UPS is cheaper than 86.36% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.70, UPS is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.41 | ||
| Fwd PE | 12.97 |
4.2 Price Multiples
UPS's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. UPS is cheaper than 72.73% of the companies in the same industry.
81.82% of the companies in the same industry are more expensive than UPS, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.46 | ||
| EV/EBITDA | 8.54 |
4.3 Compensation for Growth
UPS has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)25.51
EPS Next 2Y2.08%
EPS Next 3Y4.64%
5. Dividend
5.1 Amount
UPS has a Yearly Dividend Yield of 6.52%, which is a nice return.
UPS's Dividend Yield is rather good when compared to the industry average which is at 3.94. UPS pays more dividend than 95.45% of the companies in the same industry.
UPS's Dividend Yield is rather good when compared to the S&P500 average which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.52% |
5.2 History
The dividend of UPS is nicely growing with an annual growth rate of 11.18%!
UPS has been paying a dividend for at least 10 years, so it has a reliable track record.
UPS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)11.18%
Div Incr Years15
Div Non Decr Years25
5.3 Sustainability
UPS pays out 92.20% of its income as dividend. This is not a sustainable payout ratio.
The dividend of UPS is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP92.2%
EPS Next 2Y2.08%
EPS Next 3Y4.64%
104.47
+3.53 (+3.5%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryAir Freight & Logistics
Earnings (Last)
Earnings (Next)
Inst Owners70.46%
Inst Owner Change-1.33%
Ins Owners0%
Ins Owner Change2.17%
Market Cap88.47B
Analysts75
Price Target116.47 (11.49%)
Short Float %2.24%
Short Ratio2.98
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.52% |
Yearly Dividend6.33
Dividend Growth(5Y)11.18%
DP92.2%
Div Incr Years15
Div Non Decr Years25
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.21%
Min EPS beat(2)6.85%
Max EPS beat(2)7.57%
EPS beat(4)3
Avg EPS beat(4)2.65%
Min EPS beat(4)-10.96%
Max EPS beat(4)7.57%
EPS beat(8)6
Avg EPS beat(8)2.87%
EPS beat(12)8
Avg EPS beat(12)2.39%
EPS beat(16)12
Avg EPS beat(16)3.8%
Revenue beat(2)1
Avg Revenue beat(2)-0.04%
Min Revenue beat(2)-1.45%
Max Revenue beat(2)1.36%
Revenue beat(4)1
Avg Revenue beat(4)-0.81%
Min Revenue beat(4)-2.62%
Max Revenue beat(4)1.36%
Revenue beat(8)1
Avg Revenue beat(8)-2.03%
Revenue beat(12)1
Avg Revenue beat(12)-2.02%
Revenue beat(16)4
Avg Revenue beat(16)-1.23%
PT rev (1m)-0.69%
PT rev (3m)-13.32%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-14.84%
EPS NY rev (1m)0.13%
EPS NY rev (3m)-10.87%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.09%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-1.49%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.41 | ||
| Fwd PE | 12.97 | ||
| P/S | 0.97 | ||
| P/FCF | 16.46 | ||
| P/OCF | 9.7 | ||
| P/B | 5.65 | ||
| P/tB | 11.54 | ||
| EV/EBITDA | 8.54 |
EPS(TTM)7.79
EY7.46%
EPS(NY)8.06
Fwd EY7.71%
FCF(TTM)6.35
FCFY6.07%
OCF(TTM)10.77
OCFY10.31%
SpS107.36
BVpS18.49
TBVpS9.06
PEG (NY)N/A
PEG (5Y)25.51
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.55% | ||
| ROE | 37.39% | ||
| ROCE | 16.32% | ||
| ROIC | 12.73% | ||
| ROICexc | 14.08% | ||
| ROICexgc | 16.91% | ||
| OM | 9.48% | ||
| PM (TTM) | 6.44% | ||
| GM | 80.82% | ||
| FCFM | 5.91% |
ROA(3y)11.32%
ROA(5y)10.94%
ROE(3y)43.9%
ROE(5y)85.31%
ROIC(3y)15.05%
ROIC(5y)15.77%
ROICexc(3y)17.25%
ROICexc(5y)18.55%
ROICexgc(3y)20.55%
ROICexgc(5y)21.95%
ROCE(3y)19.3%
ROCE(5y)20.23%
ROICexcg growth 3Y-16.14%
ROICexcg growth 5Y-1.33%
ROICexc growth 3Y-16.33%
ROICexc growth 5Y-1.47%
OM growth 3Y-10.47%
OM growth 5Y-2.2%
PM growth 3Y-21.75%
PM growth 5Y1.16%
GM growth 3Y1.64%
GM growth 5Y0.43%
F-Score6
Asset Turnover1.33
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.25 | ||
| Debt/FCF | 3.98 | ||
| Debt/EBITDA | 1.59 | ||
| Cap/Depr | 103.51% | ||
| Cap/Sales | 4.12% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 74.52% | ||
| Profit Quality | 91.77% | ||
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 | ||
| Altman-Z | 3.18 |
F-Score6
WACC7.74%
ROIC/WACC1.64
Cap/Depr(3y)137.05%
Cap/Depr(5y)150.75%
Cap/Sales(3y)4.91%
Cap/Sales(5y)5.08%
Profit Quality(3y)88.01%
Profit Quality(5y)144.74%
High Growth Momentum
Growth
EPS 1Y (TTM)-2.75%
EPS 3Y-13.95%
EPS 5Y0.53%
EPS Q2Q%4.2%
EPS Next Y-8.01%
EPS Next 2Y2.08%
EPS Next 3Y4.64%
EPS Next 5Y7.12%
Revenue 1Y (TTM)1.3%
Revenue growth 3Y-2.18%
Revenue growth 5Y4.21%
Sales Q2Q%-0.74%
Revenue Next Year-4.28%
Revenue Next 2Y-1.77%
Revenue Next 3Y0.14%
Revenue Next 5Y2.35%
EBIT growth 1Y4.35%
EBIT growth 3Y-12.41%
EBIT growth 5Y1.92%
EBIT Next Year38.11%
EBIT Next 3Y17.41%
EBIT Next 5Y11.9%
FCF growth 1Y-24.85%
FCF growth 3Y-16.86%
FCF growth 5Y22.43%
OCF growth 1Y-23.85%
OCF growth 3Y-12.3%
OCF growth 5Y3.22%