UNITED PARCEL SERVICE-CL B (UPS) Stock Fundamental Analysis
USA - NYSE:UPS - US9113121068 - Common Stock
84.38 USD
+0.85 (+1.02%)
84.35 USD
-0.03 (-0.04%)
Taking everything into account, UPS scores 6 out of 10 in our fundamental rating. UPS was compared to 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 scores decently on growth, while it is valued quite cheap. This could make an interesting combination. UPS also has an excellent dividend rating. These ratings would make UPS suitable for value and dividend investing!
1. Profitability
1.1 Basic Checks
UPS had positive earnings in the past year.
UPS had a positive operating cash flow in the past year.
In the past 5 years UPS has always been profitable.
UPS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
UPS has a better Return On Assets (8.08%) than 82.61% of its industry peers.
Looking at the Return On Equity, with a value of 36.38%, UPS belongs to the top of the industry, outperforming 91.30% of the companies in the same industry.
UPS has a Return On Invested Capital of 11.69%. This is amongst the best in the industry. UPS outperforms 86.96% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for UPS is above the industry average of 12.50%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.08% | ||
| ROE | 36.38% | ||
| ROIC | 11.69% |
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 6.34%, UPS belongs to the top of the industry, outperforming 86.96% of the companies in the same industry.
In the last couple of years the Profit Margin of UPS has remained more or less at the same level.
UPS has a Operating Margin of 9.41%. This is amongst the best in the industry. UPS outperforms 86.96% of its industry peers.
In the last couple of years the Operating Margin of UPS has declined.
UPS has a Gross Margin of 81.60%. This is amongst the best in the industry. UPS outperforms 100.00% of its industry peers.
UPS's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.41% | ||
| PM (TTM) | 6.34% | ||
| GM | 81.6% |
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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), UPS is creating value.
The number of shares outstanding for UPS remains at a similar level compared to 1 year ago.
UPS has less shares outstanding than it did 5 years ago.
UPS has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.91 indicates that UPS is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of UPS (2.91) is comparable to the rest of the industry.
UPS has a debt to FCF ratio of 6.97. This is a slightly negative value and a sign of low solvency as UPS would need 6.97 years to pay back of all of its debts.
The Debt to FCF ratio of UPS (6.97) is better than 65.22% of its industry peers.
A Debt/Equity ratio of 1.51 is on the high side and indicates that UPS has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 1.51, UPS is doing worse than 69.57% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.51 | ||
| Debt/FCF | 6.97 | ||
| Altman-Z | 2.91 |
ROIC/WACC1.57
WACC7.45%
2.3 Liquidity
UPS has a Current Ratio of 1.32. 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 Current ratio value of 1.32, UPS perfoms like the industry average, outperforming 47.83% of the companies in the same industry.
UPS has a Quick Ratio of 1.32. 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 (1.32) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.32 | ||
| Quick Ratio | 1.32 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.99% over the past year.
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 0.91% in the last year.
UPS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.21% yearly.
EPS 1Y (TTM)3.99%
EPS 3Y-13.95%
EPS 5Y0.53%
EPS Q2Q%-13.41%
Revenue 1Y (TTM)0.91%
Revenue growth 3Y-2.18%
Revenue growth 5Y4.21%
Sales Q2Q%-2.74%
3.2 Future
UPS is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.93% yearly.
Based on estimates for the next years, UPS will show a small growth in Revenue. The Revenue will grow by 2.33% on average per year.
EPS Next Y-14.91%
EPS Next 2Y-2.71%
EPS Next 3Y1.57%
EPS Next 5Y6.93%
Revenue Next Year-3.93%
Revenue Next 2Y-1.81%
Revenue Next 3Y0%
Revenue Next 5Y2.33%
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 decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 11.18, the valuation of UPS can be described as reasonable.
UPS's Price/Earnings ratio is rather cheap when compared to the industry. UPS is cheaper than 86.96% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.79. UPS is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 11.53, the valuation of UPS can be described as very reasonable.
UPS's Price/Forward Earnings ratio is rather cheap when compared to the industry. UPS is cheaper than 86.96% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of UPS to the average of the S&P500 Index (23.21), we can say UPS is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.18 | ||
| Fwd PE | 11.53 |
4.2 Price Multiples
73.91% of the companies in the same industry are more expensive than UPS, based on the Enterprise Value to EBITDA ratio.
82.61% 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 | 20.15 | ||
| EV/EBITDA | 7.33 |
4.3 Compensation for Growth
The excellent profitability rating of UPS may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)21.26
EPS Next 2Y-2.71%
EPS Next 3Y1.57%
5. Dividend
5.1 Amount
UPS has a Yearly Dividend Yield of 7.82%, which is a nice return.
UPS's Dividend Yield is rather good when compared to the industry average which is at 3.79. UPS pays more dividend than 95.65% of the companies in the same industry.
UPS's Dividend Yield is rather good when compared to the S&P500 average which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.82% |
5.2 History
On average, the dividend of UPS grows each year by 11.17%, which is quite nice.
UPS has paid a dividend for at least 10 years, which is a reliable track record.
UPS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)11.17%
Div Incr Years15
Div Non Decr Years25
5.3 Sustainability
UPS pays out 94.15% of its income as dividend. This is not a sustainable payout ratio.
UPS's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP94.15%
EPS Next 2Y-2.71%
EPS Next 3Y1.57%
84.38
+0.85 (+1.02%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryAir Freight & Logistics
Earnings (Last)
Earnings (Next)
Inst Owners69.63%
Inst Owner Change-1.27%
Ins Owners0.01%
Ins Owner Change0.98%
Market Cap71.52B
Analysts73.33
Price Target106.45 (26.16%)
Short Float %2.9%
Short Ratio2.42
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.82% |
Yearly Dividend6.33
Dividend Growth(5Y)11.17%
DP94.15%
Div Incr Years15
Div Non Decr Years25
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)2.6%
Min EPS beat(2)-1.66%
Max EPS beat(2)6.85%
EPS beat(4)3
Avg EPS beat(4)4.98%
Min EPS beat(4)-1.66%
Max EPS beat(4)7.57%
EPS beat(8)5
Avg EPS beat(8)2.56%
EPS beat(12)7
Avg EPS beat(12)1.99%
EPS beat(16)11
Avg EPS beat(16)3.24%
Revenue beat(2)2
Avg Revenue beat(2)1.04%
Min Revenue beat(2)0.72%
Max Revenue beat(2)1.36%
Revenue beat(4)2
Avg Revenue beat(4)0.03%
Min Revenue beat(4)-1.45%
Max Revenue beat(4)1.36%
Revenue beat(8)2
Avg Revenue beat(8)-1.25%
Revenue beat(12)2
Avg Revenue beat(12)-1.93%
Revenue beat(16)5
Avg Revenue beat(16)-1.17%
PT rev (1m)-0.88%
PT rev (3m)-8.6%
EPS NQ rev (1m)-0.09%
EPS NQ rev (3m)-16.18%
EPS NY rev (1m)-0.21%
EPS NY rev (3m)-7.49%
Revenue NQ rev (1m)0.08%
Revenue NQ rev (3m)-0.19%
Revenue NY rev (1m)0.07%
Revenue NY rev (3m)0.36%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.18 | ||
| Fwd PE | 11.53 | ||
| P/S | 0.79 | ||
| P/FCF | 20.15 | ||
| P/OCF | 9.55 | ||
| P/B | 4.54 | ||
| P/tB | 9.43 | ||
| EV/EBITDA | 7.33 |
EPS(TTM)7.55
EY8.95%
EPS(NY)7.32
Fwd EY8.67%
FCF(TTM)4.19
FCFY4.96%
OCF(TTM)8.84
OCFY10.47%
SpS106.56
BVpS18.58
TBVpS8.95
PEG (NY)N/A
PEG (5Y)21.26
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.08% | ||
| ROE | 36.38% | ||
| ROCE | 14.99% | ||
| ROIC | 11.69% | ||
| ROICexc | 13.15% | ||
| ROICexgc | 15.69% | ||
| OM | 9.41% | ||
| PM (TTM) | 6.34% | ||
| GM | 81.6% | ||
| FCFM | 3.93% |
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-Score7
Asset Turnover1.27
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.51 | ||
| Debt/FCF | 6.97 | ||
| Debt/EBITDA | 1.96 | ||
| Cap/Depr | 107.3% | ||
| Cap/Sales | 4.36% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 61.54% | ||
| Profit Quality | 61.94% | ||
| Current Ratio | 1.32 | ||
| Quick Ratio | 1.32 | ||
| Altman-Z | 2.91 |
F-Score7
WACC7.45%
ROIC/WACC1.57
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)3.99%
EPS 3Y-13.95%
EPS 5Y0.53%
EPS Q2Q%-13.41%
EPS Next Y-14.91%
EPS Next 2Y-2.71%
EPS Next 3Y1.57%
EPS Next 5Y6.93%
Revenue 1Y (TTM)0.91%
Revenue growth 3Y-2.18%
Revenue growth 5Y4.21%
Sales Q2Q%-2.74%
Revenue Next Year-3.93%
Revenue Next 2Y-1.81%
Revenue Next 3Y0%
Revenue Next 5Y2.33%
EBIT growth 1Y14.45%
EBIT growth 3Y-12.41%
EBIT growth 5Y1.92%
EBIT Next Year31.84%
EBIT Next 3Y15.35%
EBIT Next 5Y11.63%
FCF growth 1Y-42.79%
FCF growth 3Y-16.86%
FCF growth 5Y22.43%
OCF growth 1Y-34.34%
OCF growth 3Y-12.3%
OCF growth 5Y3.22%