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<blockquote data-quote="satellitedriver" data-source="post: 253748" data-attributes="member: 1664"><p>Here is a general overview by Mark Krantz ( USA Today columnist)</p><p></p><p>UPS shares survived bear market, but have struggled lately </p><p>Q: What is the problem at United Parcel Service (UPS)? The stock just doesn't move and the dividends are nothing to brag about. </p><p>A: Everyone knows the brown trucks of United Parcel Service. But when UPS went public in 1999, investors were so swept up with the Internet they didn't pay much attention to this leading transportation company. </p><p></p><p>During UPS's first 18 months as a public company, shares languished for a variety of reasons, from fears of high energy costs to fears of the reduced need for transportation due to the recession. </p><p></p><p>But, since those fears subsided, it's been off to the races for UPS. Shares rocketed more than 57% from the bottom in March 2003 through its peak in late 2004. </p><p></p><p>But that's ancient history, right? You're probably annoyed by the sudden troubles to hit UPS stock this year. As of early September, it's dropped more than 19%, a vicious selloff when the broad Standard & Poor's 500 index lost just 0.5%. And the dividend yield of 1.9% is pretty low, especially if you can get 2% from a money market fund and take essentially no risk.</p><p></p><p>There are several reasons why UPS stock has struggled: </p><p></p><p>• Shares of most transportation companies have struggled. It's not just UPS that is in the dog house. Shares of Federal Express had fallen 18% as of early September as well. </p><p></p><p>Even the Dow Jones transportation index, a broad basket of many types of transportation stocks, was down 3.8% for the year. Not as bad as UPS or FedEx, but it goes to the point that the industry group is out of favor. </p><p></p><p>• UPS' stock held up relatively well during the bear market. Even while tech investors were losing their shirts, UPS was a place of relative safety. </p><p></p><p>Since going public in late 1999, the stock has only fallen about 1.2% through early September. That's remarkable resilience if you consider that the S&P 500 fell about 10% during the same period. So it stands to reason that if UPS held up better during the bust, it shouldn't recover as much from the bottom. </p><p></p><p>Is it time to give up on UPS? That depends on your investment goals and strategies.</p><p></p><p>I'd just like to point out that Standard & Poor's stock analyst Jim Corridore rates the stock a "buy" and has a price target of $84 on it. Corridore says in a report the company will boost revenue in 2005 by up to 14% thanks to rate increases of up to 3% and sharply higher international shipments. </p><p></p><p>The S&P analyst also thinks UPS can regain some of the market share it has lost. </p><p></p><p>But then there are those gasoline prices....</p></blockquote><p></p>
[QUOTE="satellitedriver, post: 253748, member: 1664"] Here is a general overview by Mark Krantz ( USA Today columnist) UPS shares survived bear market, but have struggled lately Q: What is the problem at United Parcel Service (UPS)? The stock just doesn't move and the dividends are nothing to brag about. A: Everyone knows the brown trucks of United Parcel Service. But when UPS went public in 1999, investors were so swept up with the Internet they didn't pay much attention to this leading transportation company. During UPS's first 18 months as a public company, shares languished for a variety of reasons, from fears of high energy costs to fears of the reduced need for transportation due to the recession. But, since those fears subsided, it's been off to the races for UPS. Shares rocketed more than 57% from the bottom in March 2003 through its peak in late 2004. But that's ancient history, right? You're probably annoyed by the sudden troubles to hit UPS stock this year. As of early September, it's dropped more than 19%, a vicious selloff when the broad Standard & Poor's 500 index lost just 0.5%. And the dividend yield of 1.9% is pretty low, especially if you can get 2% from a money market fund and take essentially no risk. There are several reasons why UPS stock has struggled: • Shares of most transportation companies have struggled. It's not just UPS that is in the dog house. Shares of Federal Express had fallen 18% as of early September as well. Even the Dow Jones transportation index, a broad basket of many types of transportation stocks, was down 3.8% for the year. Not as bad as UPS or FedEx, but it goes to the point that the industry group is out of favor. • UPS' stock held up relatively well during the bear market. Even while tech investors were losing their shirts, UPS was a place of relative safety. Since going public in late 1999, the stock has only fallen about 1.2% through early September. That's remarkable resilience if you consider that the S&P 500 fell about 10% during the same period. So it stands to reason that if UPS held up better during the bust, it shouldn't recover as much from the bottom. Is it time to give up on UPS? That depends on your investment goals and strategies. I'd just like to point out that Standard & Poor's stock analyst Jim Corridore rates the stock a "buy" and has a price target of $84 on it. Corridore says in a report the company will boost revenue in 2005 by up to 14% thanks to rate increases of up to 3% and sharply higher international shipments. The S&P analyst also thinks UPS can regain some of the market share it has lost. But then there are those gasoline prices.... [/QUOTE]
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