United Parcel Service By Michael Vida Carmela Miele Salvatore Samà 1 of 34 St. John’s University Undergraduate Student Managed Investment Fund United Parcel Service, Inc. (UPS) Type of Report: Recommendation & Analysis Recommendation: $58.40 Date: April 14, 2003 Limit order to buy 175 shares at $55.00 Market order to buy 175 shares Industry: Transportation - Air Delivery, Freight & Parcel Services Analysts: Michael Vida - mvida24@hotmail.com Carmela Miele – carmela37@aol.com Salvatore Samà – samasalvatore@yahoo.it Share Data Price - $58.40 Date – April 14, 2003 Target Price - $60.35 52 Week Price Range - $53.00 - $67.10 Market Capitalization - $ 64.644 Billion Shares Outstanding – 1.12 Billion Revenue - $31.272 …show more content…
UPS’ non-package revenue, comprised mostly of its new consulting business, is the company’s fastest growing revenue, more then doubling in the last 3 years. The fundamental analysis of UPS, relative to the industry and their competitors, demonstrated strong competitive performance. Our Technical analysis also indicated positive results and our valuations show that UPS stock is undervalued. For these reasons, we are confident that UPS will serve as a strong asset in the Student Managed Fund Portfolio Company Overview1 United Parcel Service was founded in 1907. It has locations in the United States as well as around the world. Its corporate headquarters is located in Atlanta, Georgia. UPS is the world’s largest package distribution company delivering more than 13 million documents and parcels every day and generating revenues of more than $27 billion a year. UPS is also the world’s largest express package and document delivery company, delivering more packages in two days or less that are tracked and guaranteed than any other company in the industry. It serves more than 200 countries and territories. The company operates in five international regions: Europe/Middle East & Africa; Asia Pacific; Latin America/Caribbean; Canada and the United States. The company is broken down into several divisions because of this. These divisions include UPS Air Cargo, UPS Aviation Technologies,
United Parcel Service (UPS) was founded in 1907 as a messenger company. It has grown into a multi-billion dollar corporation. Today UPS is a global company and one of the most admired and recognized brands in the world. UPS has become the largest delivery package company and leading provider of specialized transportation and logistics services in the world.
The United Parcel Services share of the marketplace commands attention: -400,000 (+) employees -$51.5 billion earned 2008 -14% profit margin -90,000 vehicles and 268 jets -Operations in over 200 countries (Thomas, Linder, & Dutra, 2006). Organization has allowed UPS to operate in financial, retail, technology and nonprofit markets as well as logistics. Management Leads with the philosophy of talent cultivation through long-term employment relationships, developing committed, aligned and experienced partners. 54% of full-time drivers started as part-time. 68% of management was promoted from within. 78% of Vice-presidents once held non-management positions with UPS (Thomas et al., 2006). Controlling within UPS develops around the standard of constructive dissatisfaction, the belief that all process can be improved on and all parameters may be extended. Constructive dissatisfaction, a culture of ownership along with continual training and market awareness keep UPS a pioneer. External Factors Globalization has empowered UPS to update their strategy to synchronizing global commerce: of goods, information and funds (Thomas et al., 2006). Once a local delivery service, now UPS is recognized globally, embracing diversity with owners and customers in from every nation. Concerned with environmental impact of big business, UPS has cut carbon emissions, from airliners, 22% since 1990, and plans to cut
In 1975 UPS reached a milestone in that it could promise to deliver a package to every address in the US. The same year the company expanded outside the US with its first delivery to Ontario Canada. The following UPS began service in West Germany with 120 of its trademark delivery brown vans.
UPS has announced that after more than 90 years as a private company, it was planning an initial public offering to become a publicly traded company. In response to this, we will first analyze UPS¡¦s business strategy and it¡¦s sustainability of its current performance. Then we will look at key factors to estimate the UPS¡¦s market capitalization value using FedEx¡¦s multiples as well as ¡§best in breed¡¨ company premiums. From this, we concluded that UPS¡¦s IPO should create a market capitalization for UPS between $17,520 million and $30,415 million.
Organizational Setting- UNITED PARCEL SERVICE Company Mission: The United States Parcel Services was founded in 1907. The company was created as an American Messenger Company. The first responsibilities of employees of the UPS ran walked by foot or rode a bike in order to make deliveries. In 1913 UPS teamed up with a competitor company and invested in their first delivery truck. While teaming up with their competitor, the decided to focus on delivering packages to stores and changed their name of business to Merchants Parcel Delivery.
UPS is a global package delivery business that specializes in not only managing the movement of goods, but the information and funds that moves with those goods in more than 200 countries and territories worldwide. UPS’s target market is primarily U.S. companies that ship business to business via ground delivery and whose delivery time is not
Given your assessment of the company's strategy and the sustainability of its performance, forecast the key factors for UPS's stock value? The original company strategy has been to deliver goods overnight. Time bound deliveries is its main selling point. It creates security in the minds of its customers by using the Guardian anti missile system on board its flight. FedEx offers a wide range of products that target customers with different needs. Federal Express has been the innovator in the strategy of allowing the customers to track their packages. This facility has developed great confidence in the system of FedEx. In fact, the tracking system of FedEx has forced other shipping companies also to use tracking systems. In promotions FedEx has adapted the strategy of using motor sports. The key factors for UPS's stock value are its size, the increasing revenues from its international operations and the increasing sales of its supply chain solutions. The investors are also impressed by the net profit of UPS that is 8.48 which is higher than the industry figure of 7.70. The return on assets is also 11.75 which is greater than
UPS has been in the package delivery business for 95 years, providing services to businesses and consumers worldwide in more than 200 countries. In 1994, UPS began to investigate the potential of e-commerce and started an internal group focused on enabling e-commerce. UPS redefined its core business and found ways to change its structure and processes, forming new businesses to take advantage of new opportunities. UPS was interested in finding ways to leverage their extensive infrastructure and expertise in basic transportation of goods, services, and
This paper is about United Parcel Service (UPS). The company is described, with specific reference to the nature of its service offering. UPS is an international firm, and as such there is discussion of the different countries in which it operates. The focal point of the paper is an analysis of UPS using the marketing mix, and with special attention to the way that the marketing mix is implemented differently in the different markets UPS serves. The four markets given the most attention are the four countries in which UPS has major hubs the US, Canada, Germany and China.
-The Logistics and Transportation Industry in the United States. (n.d.). Retrieved July 5, 2015, from http://selectusa.commerce.gov/industry-snapshots/logistics-and-transportation-industry-united-states.html
In any organization, financial analysis is one of the most basic parts of evaluation of a company operation in any business environment. As businesses operate, it is very important that the managers know the real environment for which a firm carries out its activities. The competitions evident in the market are substantial to the decision making process of a firm. Also, firms need to give much attention to the market forces of a particular industry to make sure that they are able to make these forces turn to their advantage. This paper will indicate the UPS 's bussiness enviroment, porter’s five forces, trends in the package delivery industry ,factors for success in the UPS 's industry, UPS 's relative strengths, the appropriate benchmark companies for valuation purposes, and the UPS 's accounting policies and methods,.
United Parcel Service, a logistics company has established itself through its strong corporate culture, continuous ability to innovate, and its far-reaching global network. The company has maintained a competitive advantage over the years by implementing continuous growth strategies—the first was geographic expansion, next the early adaptation of electronic tracking technologies, and then came a series of acquisitions. Although UPS is financially strong and is able to maintain its role in the courier and delivery industry—it is vital that UPS continue to act strategically as to strive for long-term success. UPS is heavily dependent on the U.S. economy and it is important that it find greater and more profitable ventures
Trends and opportunities of the parcel service industry include globalization, e-commerce, and supply-chain management. Internet logistics was FedEx and UPS’s fastest growing business. The internet enabled customers to link directly to retailers and their manufacturers. In 2001, parcel carriers served almost all of the online market. They were able to provide information on packages to customers through tracking systems on the web. This allowed customers to plan ahead and decrease delays in deliveries. It also allowed for faster transactions and lower communication costs. Parcel companies created partnerships with large Internet retailers. These partnerships allowed parcel service companies to expand its overall delivery volume. Parcel companies improved tracking by implementing several technological innovations. These included “laser scanners and bar codes, state of the art software programs, satellite and cell phone communication equipment, electronic information interchanges, and the Internet.”
In this report we focus on the two main competitors in the package delivery industry: Federal Express Corporation (FedEx) and United Parcel Service of America, Inc.
This is the primary business segment of UPS. It has positioned itself to be the leader in U.S. domestic operation of this segment. This segment of the industry is fairly concentrated in global level as well as in the domestic level in the U.S. Top 3 large companies make over 43% of global market share. This is mostly due to the competitive requirements such as large capital, complex and integrated network, expertise, and technology. These factors are very difficult to bring together in a short time horizon. This also creates entry and exit barrier into this industry. The followings are some of the key players of this industry segment.