Comparing United Parcel Service (UPS) and Its Peers

United Parcel Service (NYSE:UPS) is one of 61 public companies in the “Air Freight & Logistics” industry, but how does it contrast to its peers? We will compare United Parcel Service to related companies based on the strength of its dividends, analyst recommendations, risk, valuation, profitability, earnings and institutional ownership.

Volatility and Risk

United Parcel Service has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500. Comparatively, United Parcel Service’s peers have a beta of 0.69, meaning that their average stock price is 31% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for United Parcel Service and its peers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Parcel Service	2	11	11	1	2.44
United Parcel Service Competitors	669	2032	2609	108	2.40

United Parcel Service presently has a consensus price target of $118.45, suggesting a potential upside of 9.29%. As a group, “Air Freight & Logistics” companies have a potential upside of 21.20%. Given United Parcel Service’s peers higher probable upside, analysts clearly believe United Parcel Service has less favorable growth aspects than its peers.

Dividends

United Parcel Service pays an annual dividend of $6.56 per share and has a dividend yield of 6.1%. United Parcel Service pays out 126.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Air Freight & Logistics” companies pay a dividend yield of 2.6% and pay out 41.4% of their earnings in the form of a dividend. United Parcel Service has raised its dividend for 16 consecutive years.

Institutional & Insider Ownership

60.3% of United Parcel Service shares are held by institutional investors. Comparatively, 42.7% of shares of all “Air Freight & Logistics” companies are held by institutional investors. 0.2% of United Parcel Service shares are held by insiders. Comparatively, 18.4% of shares of all “Air Freight & Logistics” companies are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares United Parcel Service and its peers top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
United Parcel Service	$91.37 billion	$5.57 billion	20.84
United Parcel Service Competitors	$10.82 billion	$472.10 million	9.29

United Parcel Service has higher revenue and earnings than its peers. United Parcel Service is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares United Parcel Service and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Parcel Service	4.84%	37.78%	8.13%
United Parcel Service Competitors	-1,651.27%	-22.26%	-11.48%

Summary

United Parcel Service beats its peers on 11 of the 15 factors compared.

United Parcel Service Company Profile

United Parcel Service, Inc., a package delivery company, provides transportation and delivery, distribution, contract logistics, ocean freight, airfreight, customs brokerage, and insurance services. It operates through two segments, U.S. Domestic Package and International Package. The U.S. Domestic Package segment offers time-definite delivery of express letters, documents, small packages, and palletized freight through air and ground services in the United States. The International Package segment provides guaranteed day and time-definite international shipping services comprising guaranteed time-definite express options in Europe, Asia, the Indian sub-continent, the Middle East, Africa, Canada, and Latin America. The company also offers international air and ocean freight forwarding, post-sales, and mail and consulting services. In addition, it provides truckload and customs brokerage services; supply chain solutions to the healthcare and life sciences industries; fulfillment and transportation management services; and integrated supply chain and shipment insurance solutions. United Parcel Service, Inc. was founded in 1907 and is headquartered in Atlanta, Georgia.