United Parcel Service Inc (UPS) Class B Stock Buy Recommendation Reiterated (UPS)
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- UNITED PARCEL SERVICE INC has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, UNITED PARCEL SERVICE INC increased its bottom line by earning $3.83 versus $3.47 in the prior year. This year, the market expects an improvement in earnings ($4.59 versus $3.83).
- UPS, with its decline in revenue, slightly underperformed the industry average of 3.1%. Since the same quarter one year prior, revenues slightly dropped by 0.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Air Freight & Logistics industry and the overall market, UNITED PARCEL SERVICE INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- The gross profit margin for UNITED PARCEL SERVICE INC is rather low; currently it is at 16.30%. Regardless of UPS's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 3.58% trails the industry average.
- Currently the debt-to-equity ratio of 1.99 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Even though the debt-to-equity ratio is weak, UPS's quick ratio is somewhat strong at 1.42, demonstrating the ability to handle short-term liquidity needs.
--Written by a member of TheStreet Ratings Staff. HOLIDAY SPECIAL: Let Jim Cramer show you every trade he is making in his $2.5 Million portfolio. Join now for 14-days FREE. Sign up today to get e-mail alerts before every trade
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