NEW YORK (TheStreet) -- TheStreet's Jim Cramer says the transports have always been the most important index he follows, and these stocks have been going higher recently, unlike airlines and railroads. Packaging, specifically UPS (UPS - Get Report), has also been rising.
Cramer notes UPS reported a poor number and the stock dropped from $100 to the low $90 range. But the stock is now above $100 again because retail sales have improved and the harsh winter weather has passed. He believes UPS is the tell that the tepid April sales number will be wrong.
Cramer likes retailers going into earnings season because UPS is telling him that shopping is back.
- Despite its growing revenue, the company underperformed as compared with the industry average of 3.4%. Since the same quarter one year prior, revenues slightly increased by 2.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Net operating cash flow has increased to $2,266.00 million or 28.89% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 10.92%.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- UNITED PARCEL SERVICE INC's earnings per share declined by 9.3% in the most recent quarter compared to 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 $4.62 versus $0.80 in the prior year. This year, the market expects an improvement in earnings ($5.08 versus $4.62).
- The gross profit margin for UNITED PARCEL SERVICE INC is currently extremely low, coming in at 10.98%. It has decreased from the same quarter the previous year. Regardless of the weak results of the gross profit margin, the net profit margin of 6.61% is above that of the industry average.
- You can view the full analysis from the report here: UPS Ratings Report
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