Which Blue Chip Shipping Stock Has the Strongest Earnings Trends: UPS or FedEx?

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Earnings trends are extremely important when evaluating stocks. At Wall St. Cheat Sheet, we view increasing earnings quarter-over-quarter as a simple way to gauge whether costs and the business model are stable. Then we like to analyze whether the company is outperforming peers in the sector. This is what we call the “E-Squared” investment analysis (‘E = Earnings Are Increasing Quarter-Over-Quarter’ + ‘E = Excellent Relative Performance Versus Peers and Sector’).

Stocks with improving earnings metrics are worthy of your extra attention. Click here to discover our CHEAT SHEET stock picks now!

Here’s your Cheat Sheet to how the top 2 shipping stocks rank via earnings trends:

United Parcel Service, Inc. (NYSE:UPS): Current Price $79.97

Fiscal Year 2008 2009 2010 2011 2012
Revenue ($) in millions 51,490 45,300 49,540 53,100 54,130
Diluted EPS ($) 2.94 1.96 3.33 3.84 0.83

Annual revenue at UPS has shown a rising trend after 2009, and so did EPS until 2011. But earnings plunged in 2012.

Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter Dec. 31, 2011 Mar. 31, 2012 Jun. 30, 2012 Sep. 30, 2012 Dec. 31, 2012
Revenue ($) in millions 14,170 13,140 13,350 13,070 14,570
Diluted EPS ($) 0.75 1.00 1.15 0.48 -1.83

Quarterly revenue trends have been mixed, but sales moved up sharply in the latest December 2012 quarter. Unfortunately, EPS went the other direction, reporting a massive negative figure. Will FedEx show better trends? Let’s find out…

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