Head-To-Head Review: United Parcel Service (UPS) versus Its Competitors

United Parcel Service (NYSE:UPS) is one of 60 publicly-traded companies in the “Air Freight & Logistics” industry, but how does it weigh in compared to its competitors? We will compare United Parcel Service to related businesses based on the strength of its risk, earnings, profitability, dividends, analyst recommendations, valuation and institutional ownership.

Volatility and Risk

United Parcel Service has a beta of 1.06, meaning that its stock price is 6% more volatile than the S&P 500. Comparatively, United Parcel Service’s competitors have a beta of 0.88, meaning that their average stock price is 12% less volatile than the S&P 500.

Dividends

United Parcel Service pays an annual dividend of $6.56 per share and has a dividend yield of 6.3%. United Parcel Service pays out 121.9% 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 44.5% of their earnings in the form of a dividend. United Parcel Service has raised its dividend for 16 consecutive years.

Analyst Recommendations

This is a summary of current ratings and recommmendations for United Parcel Service and its competitors, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Parcel Service	2	10	8	1	2.38
United Parcel Service Competitors	606	1973	2543	106	2.41

United Parcel Service currently has a consensus target price of $117.41, indicating a potential upside of 12.91%. As a group, “Air Freight & Logistics” companies have a potential upside of 16.11%. Given United Parcel Service’s competitors stronger consensus rating and higher possible upside, analysts clearly believe United Parcel Service has less favorable growth aspects than its competitors.

Earnings and Valuation

This table compares United Parcel Service and its competitors gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
United Parcel Service	$88.66 billion	$5.57 billion	19.33
United Parcel Service Competitors	$12.36 billion	$609.53 million	14.17

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
United Parcel Service	5.08%	37.50%	8.21%
United Parcel Service Competitors	-461.30%	-1.09%	-8.25%

Institutional & Insider Ownership

60.3% of United Parcel Service shares are held by institutional investors. Comparatively, 42.6% of shares of all “Air Freight & Logistics” companies are held by institutional investors. 0.2% of United Parcel Service shares are held by company insiders. Comparatively, 18.4% of shares of all “Air Freight & Logistics” companies are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

United Parcel Service beats its competitors on 10 of the 15 factors compared.

About United Parcel Service

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.