UNITED PARCEL SERVICE-CL B (UPS) Stock Fundamental Analysis
NYSE:UPS - New York Stock Exchange, Inc. - US9113121068 - Common Stock - Currency: USD
Overall UPS gets a fundamental rating of 6 out of 10. We evaluated UPS against 23 industry peers in the Air Freight & Logistics industry. UPS scores excellent on profitability, but there are some minor concerns on its financial health. UPS has a decent growth rate and is not valued too expensively. Finally UPS also has an excellent dividend rating. These ratings would make UPS suitable for dividend investing!
1. Profitability
1.1 Basic Checks
UPS had positive earnings in the past year.
In the past year UPS had a positive cash flow from operations.
UPS had positive earnings in each of the past 5 years.
In the past 5 years UPS always reported a positive cash flow from operatings.
1.2 Ratios
UPS has a better Return On Assets (8.25%) than 78.95% of its industry peers.
Looking at the Return On Equity, with a value of 34.59%, UPS belongs to the top of the industry, outperforming 94.74% of the companies in the same industry.
UPS has a better Return On Invested Capital (12.38%) than 84.21% of its industry peers.
UPS had an Average Return On Invested Capital over the past 3 years of 14.99%. This is above the industry average of 11.36%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.25% | ||
| ROE | 34.59% | ||
| ROIC | 12.38% |
ROA(3y)11.32%
ROA(5y)10.94%
ROE(3y)43.9%
ROE(5y)85.31%
ROIC(3y)14.99%
ROIC(5y)15.74%
1.3 Margins
The Profit Margin of UPS (6.35%) is better than 84.21% of its industry peers.
In the last couple of years the Profit Margin of UPS has remained more or less at the same level.
The Operating Margin of UPS (9.35%) is better than 89.47% of its industry peers.
UPS's Operating Margin has declined in the last couple of years.
With an excellent Gross Margin value of 80.28%, UPS belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
In the last couple of years the Gross Margin of UPS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.35% | ||
| PM (TTM) | 6.35% | ||
| GM | 80.28% |
OM growth 3Y-10.84%
OM growth 5Y-2.45%
PM growth 3Y-21.75%
PM growth 5Y1.16%
GM growth 3Y1.64%
GM growth 5Y0.43%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), UPS is creating value.
UPS has about the same amout of shares outstanding than it did 1 year ago.
UPS has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, UPS has an improved debt to assets ratio.
2.2 Solvency
UPS has an Altman-Z score of 3.29. This indicates that UPS is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.29, UPS is in the better half of the industry, outperforming 68.42% of the companies in the same industry.
The Debt to FCF ratio of UPS is 3.43, which is a good value as it means it would take UPS, 3.43 years of fcf income to pay off all of its debts.
UPS has a Debt to FCF ratio of 3.43. This is in the better half of the industry: UPS outperforms 68.42% of its industry peers.
A Debt/Equity ratio of 1.16 is on the high side and indicates that UPS has dependencies on debt financing.
UPS has a Debt to Equity ratio of 1.16. This is in the lower half of the industry: UPS underperforms 68.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.16 | ||
| Debt/FCF | 3.43 | ||
| Altman-Z | 3.29 |
ROIC/WACC1.51
WACC8.2%
2.3 Liquidity
A Current Ratio of 1.17 indicates that UPS should not have too much problems paying its short term obligations.
With a Current ratio value of 1.17, UPS perfoms like the industry average, outperforming 42.11% of the companies in the same industry.
UPS has a Quick Ratio of 1.17. This is a normal value and indicates that UPS is financially healthy and should not expect problems in meeting its short term obligations.
UPS has a Quick ratio of 1.17. This is comparable to the rest of the industry: UPS outperforms 47.37% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.17 | ||
| Quick Ratio | 1.17 |
3. Growth
3.1 Past
The earnings per share for UPS have decreased strongly by -11.96% in the last year.
Measured over the past 5 years, UPS shows a small growth in Earnings Per Share. The EPS has been growing by 0.53% on average per year.
Looking at the last year, UPS shows a small growth in Revenue. The Revenue has grown by 0.12% 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)-11.96%
EPS 3Y-13.95%
EPS 5Y0.53%
EPS Q2Q%11.34%
Revenue 1Y (TTM)0.12%
Revenue growth 3Y-2.18%
Revenue growth 5Y4.21%
Sales Q2Q%1.54%
3.2 Future
UPS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.99% yearly.
Based on estimates for the next years, UPS will show a small growth in Revenue. The Revenue will grow by 5.08% on average per year.
EPS Next Y2.88%
EPS Next 2Y7.6%
EPS Next 3Y9.57%
EPS Next 5Y12.99%
Revenue Next Year-1.68%
Revenue Next 2Y0.02%
Revenue Next 3Y2.22%
Revenue Next 5Y5.08%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 15.05, UPS is valued correctly.
UPS's Price/Earnings ratio is a bit cheaper when compared to the industry. UPS is cheaper than 73.68% of the companies in the same industry.
UPS is valuated rather cheaply when we compare the Price/Earnings ratio to 29.63, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 14.63, which indicates a correct valuation of UPS.
UPS's Price/Forward Earnings ratio is rather cheap when compared to the industry. UPS is cheaper than 84.21% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of UPS to the average of the S&P500 Index (22.68), we can say UPS is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.05 | ||
| Fwd PE | 14.63 |
4.2 Price Multiples
UPS's Enterprise Value to EBITDA is on the same level as the industry average.
UPS's Price/Free Cash Flow ratio is rather cheap when compared to the industry. UPS is cheaper than 89.47% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.98 | ||
| EV/EBITDA | 9.42 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates UPS does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of UPS may justify a higher PE ratio.
PEG (NY)5.22
PEG (5Y)28.63
EPS Next 2Y7.6%
EPS Next 3Y9.57%
5. Dividend
5.1 Amount
UPS has a Yearly Dividend Yield of 5.67%, which is a nice return.
UPS's Dividend Yield is rather good when compared to the industry average which is at 3.82. UPS pays more dividend than 100.00% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.29, UPS pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.67% |
5.2 History
The dividend of UPS is nicely growing with an annual growth rate of 11.18%!
UPS has paid a dividend for at least 10 years, which is a reliable track record.
UPS has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)11.18%
Div Incr Years15
Div Non Decr Years25
5.3 Sustainability
93.38% of the earnings are spent on dividend by UPS. This is not a sustainable payout ratio.
The dividend of UPS is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP93.38%
EPS Next 2Y7.6%
EPS Next 3Y9.57%
116.33
-0.27 (-0.23%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryAir Freight & Logistics
Earnings (Last)
Earnings (Next)
Inst Owners72.36%
Inst Owner Change-2.44%
Ins Owners0%
Ins Owner Change-1.22%
Market Cap99.27B
Analysts76
Price Target151.36 (30.11%)
Short Float %2.29%
Short Ratio2.76
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.67% |
Yearly Dividend6.33
Dividend Growth(5Y)11.18%
DP93.38%
Div Incr Years15
Div Non Decr Years25
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.36%
Min EPS beat(2)7.14%
Max EPS beat(2)7.57%
EPS beat(4)3
Avg EPS beat(4)3.45%
Min EPS beat(4)-10.96%
Max EPS beat(4)10.07%
EPS beat(8)5
Avg EPS beat(8)1.83%
EPS beat(12)8
Avg EPS beat(12)2.22%
EPS beat(16)12
Avg EPS beat(16)7.08%
Revenue beat(2)0
Avg Revenue beat(2)-0.98%
Min Revenue beat(2)-1.45%
Max Revenue beat(2)-0.52%
Revenue beat(4)0
Avg Revenue beat(4)-1.57%
Min Revenue beat(4)-2.62%
Max Revenue beat(4)-0.52%
Revenue beat(8)0
Avg Revenue beat(8)-2.37%
Revenue beat(12)1
Avg Revenue beat(12)-2.02%
Revenue beat(16)4
Avg Revenue beat(16)-0.65%
PT rev (1m)0.17%
PT rev (3m)2.44%
EPS NQ rev (1m)-17.5%
EPS NQ rev (3m)-26.52%
EPS NY rev (1m)-9.96%
EPS NY rev (3m)-10.63%
Revenue NQ rev (1m)-5.25%
Revenue NQ rev (3m)-8.98%
Revenue NY rev (1m)-5.54%
Revenue NY rev (3m)-5.4%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.05 | ||
| Fwd PE | 14.63 | ||
| P/S | 1.09 | ||
| P/FCF | 15.98 | ||
| P/OCF | 9.81 | ||
| P/B | 5.94 | ||
| P/tB | 10.61 | ||
| EV/EBITDA | 9.42 |
EPS(TTM)7.73
EY6.64%
EPS(NY)7.95
Fwd EY6.84%
FCF(TTM)7.28
FCFY6.26%
OCF(TTM)11.86
OCFY10.2%
SpS106.72
BVpS19.59
TBVpS10.96
PEG (NY)5.22
PEG (5Y)28.63
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.25% | ||
| ROE | 34.59% | ||
| ROCE | 15.88% | ||
| ROIC | 12.38% | ||
| ROICexc | 14.03% | ||
| ROICexgc | 16.62% | ||
| OM | 9.35% | ||
| PM (TTM) | 6.35% | ||
| GM | 80.28% | ||
| FCFM | 6.82% |
ROA(3y)11.32%
ROA(5y)10.94%
ROE(3y)43.9%
ROE(5y)85.31%
ROIC(3y)14.99%
ROIC(5y)15.74%
ROICexc(3y)17.19%
ROICexc(5y)18.52%
ROICexgc(3y)20.48%
ROICexgc(5y)21.91%
ROCE(3y)19.23%
ROCE(5y)20.19%
ROICexcg growth 3Y-16.49%
ROICexcg growth 5Y-1.58%
ROICexc growth 3Y-16.68%
ROICexc growth 5Y-1.72%
OM growth 3Y-10.84%
OM growth 5Y-2.45%
PM growth 3Y-21.75%
PM growth 5Y1.16%
GM growth 3Y1.64%
GM growth 5Y0.43%
F-Score7
Asset Turnover1.3
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.16 | ||
| Debt/FCF | 3.43 | ||
| Debt/EBITDA | 1.6 | ||
| Cap/Depr | 108.31% | ||
| Cap/Sales | 4.29% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 83.48% | ||
| Profit Quality | 107.45% | ||
| Current Ratio | 1.17 | ||
| Quick Ratio | 1.17 | ||
| Altman-Z | 3.29 |
F-Score7
WACC8.2%
ROIC/WACC1.51
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)-11.96%
EPS 3Y-13.95%
EPS 5Y0.53%
EPS Q2Q%11.34%
EPS Next Y2.88%
EPS Next 2Y7.6%
EPS Next 3Y9.57%
EPS Next 5Y12.99%
Revenue 1Y (TTM)0.12%
Revenue growth 3Y-2.18%
Revenue growth 5Y4.21%
Sales Q2Q%1.54%
Revenue Next Year-1.68%
Revenue Next 2Y0.02%
Revenue Next 3Y2.22%
Revenue Next 5Y5.08%
EBIT growth 1Y-6.84%
EBIT growth 3Y-12.78%
EBIT growth 5Y1.66%
EBIT Next Year50.86%
EBIT Next 3Y19.27%
EBIT Next 5Y16.65%
FCF growth 1Y22.3%
FCF growth 3Y-16.86%
FCF growth 5Y22.43%
OCF growth 1Y-1.13%
OCF growth 3Y-12.3%
OCF growth 5Y3.22%