Analyst report

Discussion in 'The Archives' started by tuknick, Jun 19, 2002.

  1. tuknick

    tuknick Guest

    Here is a copy of a recent analyst report on UPS.

    Looks good to me!


    United Parcel Service (UPS)
    > UPS gaining some momentum; Expect UPS to outpace guidance; Teamster strike
    > unlikely; sheet
    > > International markets picking up; One of the cleanest balance sheets in
    > addition to an off-balance
    > > asset; Expect stock to be included in S&P 500
    >
    > > Recent comments from the company in terms of the economy are that it
    > appears the U.S. is bumping along a bottom; however, we feel the U.S. is
    > doing better than that. Asia has picked up and Europe remains strong for
    the
    > company (international represents about 30% of business for UPS).
    Management
    > felt no indications of pricing becoming irrational in the ground market.
    > Management's guidance for 2Q:02 EPS remains in the $0.50 - 0.55 range;
    > however, we are keeping our $0.56 estimate. We recognize that our 2Q:02
    > forecast is ahead of the company's guidance, but we suspect that UPS will
    > outpace its guidance by about at least a penny or so.
    > >
    > > Management and the Teamsters have reviewed all economic based issues,
    and
    > at this point they are in the stages of discussing non-economic issues
    > (NOTE: UPS is the largest employer of Teamsters). While the stock has
    > already been strong in the last two weeks as a result of progress with the
    > Teamsters, we believe any positive developments that unfold within the
    next
    > 2 - 3 weeks could help to push the stock up even further in our opinion.
    > >
    > > The company is among the only eight AAA-rated companies among the
    > industrials. For 2002, if our forecasts are correct, we believe the
    company
    > has the means to generate sizable amounts of cash and achieve a net debt
    to
    > net debt + equity ratio of 9% and a debt ratio of 20%. As the company
    > continues to generate sizable amounts of free cash flow going forward, we
    > believe the company's net debt to net debt + equity could get as low as
    2%,
    > with a debt ratio of 17% by 2003. This is not even accounting for the IRS
    > settlement. The timing and amount collectable of UPS's $1.8 billion IRS
    tax
    > settlement remains unresolved. We are aware that it is concurrently being
    > handled in court while ongoing settlement discussions are also occurring
    > with the IRS. In our opinion, a settlement should occur soon.
    > >
    > > With regard to the UPS and the S&P 500, increasing trading volume and
    > liquidity remain some of the final barriers towards inclusion into the S&P
    > 500 in our opinion. At the current level of average daily trading volume
    for
    > the past month of 1.7 million shares, we calculate that the implied number
    > of days to fill all buy orders from index funds for the stock would be
    29 -
    > 41 days, following an adjustment for the 30 million share shelf
    > registration. We would not be surprised to see S&P 500 inclusion happen
    this
    > year.
     
  2. upsace

    upsace Guest

    Yes, it sounds great. But without the name of the analyst it means nothing.
    Who was it?
     
  3. rshoe4056

    rshoe4056 Guest

    The "quote" was from Credit Swiss First Boston, and it came out 6-14-02. Their Target price for UPS is "low 70's" in 12 months.

    Regards,
    Bob