Opinions
Ian Fung
United Parcel Services
UPS-N
COMMENT
Feb 21, 2020
Stock price when the opinion was issued
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A dividend pick for 2025. Is down a lot from their highs. A contrarian play. It pays around a 5% dividend yield. It trades at a reasonable valuation and offers decent earnings growth in 2025 of 5-7%. Collect the dividend and enjoy a little capital appreciation on top. You won't shoot the lights out, but you can relax with this steady earner.
United Parcel Service, Inc. (UPS) is a package delivery company. The Company is a provider of global supply chain management solutions. The Company operates through three segments: U.S. Domestic Package operations, International Package operations, and Supply Chain & Freight operations. As of December 31, 2016, the Company delivered packages in over 220 countries and territories. The Company offers a spectrum of the United States domestic guaranteed ground and air package transportation services. The International Package segment includes the small package operations in Europe, Asia-Pacific, Canada and Latin America, the Indian sub-continent, the Middle East and Africa. The Supply Chain & Freight segment includes its forwarding and logistics services, truckload freight brokerage, UPS Freight and its financial offerings through UPS Capital. The Company serves the global market for logistics services, which include transportation, distribution, contract logistics and ground freight. Social media mentions are up 2500% in the past 24h.
He likes the UPS name. There are really only two big players in the space, them and FedEx. He prefers FedEx and owns that one. The problem is that there is a growing need for capital to move towards same-day delivery. He thinks FedEx did a smart thing pushing back on Amazon pricing terms and they have reduced their exposure to them to only 1% of revenues.