Fedex, UPS Rise: Dahlman Prefers FDX - Barrons
Shares of Fedex (FDX) and United Parcel Service (UPS) are both higher this afternoon after Dahlman Rose analyst Jason Seidl iniated coverage of the two stocks with a “Buy” rating on Fedex and a $97 price target and a “Hold” rating on UPS.
Fedex shares may face pressure “in the near term” from uncertainty about global economic recovery, writes Seidl, but the stock, trading at just 14 times 2011 EPS estimates, is cheaper than its 10-year P/E historical average of 19 times.
As for UPS, it’s also, like Fedex, historically cheap, at 16 times 2011 EPS projections, versus an average in the early part of the last decade of 25 times earnings. But multiples have contracted to 16 to 19 times earnings in recent years, so he doesn’t see enough upside to merit buying the shares.
Shares of Fedex (FDX) and United Parcel Service (UPS) are both higher this afternoon after Dahlman Rose analyst Jason Seidl iniated coverage of the two stocks with a “Buy” rating on Fedex and a $97 price target and a “Hold” rating on UPS.
Fedex shares may face pressure “in the near term” from uncertainty about global economic recovery, writes Seidl, but the stock, trading at just 14 times 2011 EPS estimates, is cheaper than its 10-year P/E historical average of 19 times.
As for UPS, it’s also, like Fedex, historically cheap, at 16 times 2011 EPS projections, versus an average in the early part of the last decade of 25 times earnings. But multiples have contracted to 16 to 19 times earnings in recent years, so he doesn’t see enough upside to merit buying the shares.
