5 -year comparison UPS vs FDX

[Dfigtree]

Here's how UPS stock has performed versus FDX for the last 5 years,

Yahoo! Finance Charts
Yahoo! Finance Charts
For those corporate types who care to look at this, the discrepancy is not the economy (as far as I know UPS and FDX operate within the same economic realities). It's not the American political system (as far as I know both UPS and FDX operate within the political realities). And, it's not the competition (as far as I know with the exclusion of each other, UPS and FDX operate in the same competitive environment).

So, what could account for a 5 year growth of a total 30% for UPS versus 120% for FDX?

a) leadership
b) business background of the CEO
c) management committee decisions
d) composition of the Bored of Directors
e) employee morale


Dunno. What do you think?

 

[down on the stock]

you're being pretty generous with the 5 year 30% number. if you go back to the close of the day ups went public (11/99) the stock is up around 6 bucks in 7 years. my apologies to the general buy and hold investors that bought stock that day. hope you weren't looking for capital appreciation.

 

[breadbooze]

The annual reports are your friend. Stock pricing is nothing more than a numerical value of investor sentiment. UPS can simply retire about 300 million shares to bring its share prices up to FDX levels, though that won't be happening.

 

[Dfigtree]

you're being pretty generous with the 5 year 30% number. if you go back to the close of the day ups went public (11/99) the stock is up around 6 bucks in 7 years. my apologies to the general buy and hold investors that bought stock that day. hope you weren't looking for capital appreciation.

Yahoo! Finance Charts

Is that any better? I just thought 5 years matched up pretty good to our esteemed CEO's tenure.

As for retiring stock ... how exactly is that done?

 

[tieguy]

you're being pretty generous with the 5 year 30% number. if you go back to the close of the day ups went public (11/99) the stock is up around 6 bucks in 7 years. my apologies to the general buy and hold investors that bought stock that day. hope you weren't looking for capital appreciation.

You would have to include close to 8 bucks a share paid out in dividends.

 

[wyobill]

You can have that Fed Ex Stock. It dosent pay crap for a dividend. It sat at 50 bucks for 50 years.

 

[Dfigtree]

You can have that Fed Ex Stock. It dosent pay crap for a dividend. It sat at 50 bucks for 50 years.

Yahoo! Finance Charts

I am not a technical guy, but that looks like a pretty good 25 year chart.

And if you are going to talk about dividends, it might make sense to talk about how they are taxed differently than long term capital gains.

 

[satellitedriver]

You would have to include close to 8 bucks a share paid out in dividends.

But you have to admit that inflation averages about 3% a year and UPS dividends only pay 2.2% a year, so it still looks like a negative to me.

 

[satellitedriver]

Yahoo! Finance Charts

I am not a technical guy, but that looks like a pretty good 25 year chart.

And if you are going to talk about dividends, it might make sense to talk about how they are taxed differently than long term capital gains.

Click on Financial Planners Yahoo link then click on UPS for a comparison chart.
It says it all.

 

[satellitedriver]

Yahoo! Finance Charts

I am not a technical guy, but that looks like a pretty good 25 year chart.

And if you are going to talk about dividends, it might make sense to talk about how they are taxed differently than long term capital gains.

You can have that Fed Ex Stock. It dosent pay crap for a dividend. It sat at 50 bucks for 50 years.

You must use a different calander than I do. Fedex hasn't been on the stock market that long. It also sat in the 50's for less than a year. I do not own Fedex, nor will I.
There are so many more investments out there than will bring you better returns. Please do some research and prosper.

 

[Air1]

It will only change when the Mike and Scotty show closes. We can only hope it's soon. Where are the real Wall Steet analysts that look at the company and its leadership rather than just the numbers someone needs to remind them our future is ahead of us (thanks to Yogi). Mike and Scotty are sitting on their wallets and the Board is asleep in their laps.

 

[Dfigtree]

But you have to admit that inflation averages about 3% a year and UPS dividends only pay 2.2% a year, so it still looks like a negative to me.

Dividends are a bad thing because they are taxed twice. Once at the corporate level and once at the shareholder level. Warren Buffet will never pay a dividend on Berkshire Hathaway for that reason.

Of course, if UPS did not pay a dividend, there would be a lot of UPS folks trying to find creative ways to pay their next hypothecation payment.

 

[brownmonster]

Buffet said "buy stock in a company any fool can run, eventually one will"

 

[Dfigtree]

Buffet said "buy stock in a company any fool can run, eventually one will"

UPS - Tax-basis calculator

$1000 dollars invested in UPS on 11/10/1999 would be worth 1268.02 on 2/07/2007.

Using CNNMoney.Com's Rate of return calculator

You find that for the various investment risks you have taken, you have achieved a whopping 3.3% annual return on investment. Should the BOD be taking the CEO, the CFO and the CIO to task for failing the UPS shareholders? Sure they should. Will they? No! Because they really have no vested interest to do so. UPS - Director Compensation

Return on investment:
Annualized return: 3.33%
Return for the entire period: 26.77%

 

[tonyexpress]

UPS - Tax-basis calculator

$1000 dollars invested in UPS on 11/10/1999 would be worth 1268.02 on 2/07/2007.

Using CNNMoney.Com's Rate of return calculator

You find that for the various investment risks you have taken, you have achieved a whopping 3.3% annual return on investment. Should the BOD be taking the CEO, the CFO and the CIO to task for failing the UPS shareholders? Sure they should. Will they? No! Because they really have no vested interest to do so. UPS - Director Compensation

Return on investment:
Annualized return: 3.33%
Return for the entire period: 26.77%

Interesting information... Just wondered what the figures would be if you backed that date up to 11/09/1999.


How dividends work for Investors


The New, Lower Tax on Dividends


"Dividends are a bad thing because they are taxed twice. Once at the corporate level and once at the shareholder level. Warren Buffet will never pay a dividend on Berkshire Hathaway for that reason."

By the way Warren Buffet put 8 billion dollars to work in 2006. Guess what one of the companies he bought was??? That's right UPS!

To quote the great Warren Buffet, "Investors should think like owners and these firms are worth owning for the long haul." UPS was one of 7 companies he mentioned.

 

[Dfigtree]

Click on Financial Planners Yahoo link then click on UPS for a comparison chart.
It says it all.

SatelliteDriver,

Can you provide the URL of that link?

FP

 

[Dfigtree]

Interesting information... Just wondered what the figures would be if you backed that date up to 11/09/1999.


How dividends work for Investors


The New, Lower Tax on Dividends


"Dividends are a bad thing because they are taxed twice. Once at the corporate level and once at the shareholder level. Warren Buffet will never pay a dividend on Berkshire Hathaway for that reason."


By the way Warren Buffet put 8 billion dollars to work in 2006. Guess what one of the companies he bought was??? That's right UPS!

To quote the great Warren Buffet, "Investors should think like owners and these firms are worth owning for the long haul." UPS was one of 7 companies he mentioned.

And he bought and ran Solomon Brothers, US AIR and host of smelly stuff.
BUT BERKSHIRE HATHAWAY WILL NEVER PAY A DIVIDEND. NEVER! Unless of course Congress eliminates double taxation. I would put out the WELCOME MAT for Warren as he walks past OLE NUMBER ONE to become a member of UPS' BOD. WOW. How great would that be?

UPS' rate of 3.3% per year befowls Warrens return.

 

[Dfigtree]

Tony,

Did you read the article? The dividend treatment is temporary.
The New, Lower Tax on Dividends

From above:

Sunset provisions
As with virtually all of the provisions of the 2003 tax act, the lower tax rates on dividend income will expire at the end of 2008. That means, unless made permanent by some future Congress, these new provisions will fade into the sunset, and the rules on the taxation of dividends will revert back to the old rules (ordinary income taxed at your normal tax rate).

 

[tonyexpress]

Yes I read the article, hopefully they will extend it.

By the way since we're talking about dividends UPS must have heard us because today they announced that they will be raising the dividend from 38 cents to 42 cents, a nice 10% increase. In addition to that they will increase their buy back to 2 billion..

Now we can really make those hypo payments..

 

[Dfigtree]

Yes I read the article, hopefully they will extend it.

By the way since we're talking about dividends UPS must have heard us because today they announced that they will be raising the dividend from 38 cents to 42 cents, a nice 10% increase. In addition to that they will increase their buy back to 2 billion..

Now we can really make those hypo payments..

Today's UPS price change: 0.59
Today's increase in dividend annualized for 2007 .16
------------------------- ------------------------ -------
Net increase in value per share after 1 day including 0.43
annualized dividend increase

I'd say the bad news outweighed the good news just for today.

Buying back shares is meaningless. To buy back the shares, the company "gives" money to the shareholder it is buying the shares from. Now the company has more shares and less money.

When a company such as UPS is cash rich, and UPS is cash rich, it can do three things with the money.

1) Invest the money in itself, like develop a new productivity system, say, PAS, or replacing old equipment (are there any DC8's left).
2) It can buy back shares.
3) It can pay out the cash as a dividend. It is my understanding that the BOD a couple of years ago was discussing a large one time dividend to reward the shareholders because there was so much cash on hand. Never happened, or more likely, it was a false rumor. UPS can raise the dividend .04 / quarter if wanted to for a long time. However, I suspect that more investments in itself , like PAS, are in the offing.

May the Schwartz (not a person named Schwartz, Cheryl, but simply referring to my avatar), may the Schwartz resign. FP