UPS Delivers

04/14/2016 8:00 am EST

Focus: STOCKS

Todd Shaver

Founder and Editor-in-Chief, BullMarket.com

Founded in 1907, our latest featured stock has seen it all; the firm is the biggest package delivery company worldwide, explains Todd Shaver, editor of BullMarket.com.

Delivering loads of things to lots of places is just one part of the United Parcel Service (UPS) value proposition.

They serve up a multitude of technology-driven logistics designed to create major cost savings for their corporate customers. In a world of global trade, companies like UPS play a key role.

UPS’s ever evolving skills in logistics and position of leadership in the so-called “less-than-truckload” industry, places them in just the right spot to benefit from the explosion of online package delivery.

Just take a look at this fast-growing area. Since the dawn of the consumer Internet, e-commerce has been growing at big double-digit rates, taking market share from old time traditional retailers.

E-commerce will remain the fastest growing part of the US consumer economy. Mainstream consumers have adapted to the virtual shopping world. Buyers are offered convenience and increasingly rapid delivery. 

There has been speculation that Amazon (AMZN) will lay waste to all other participants in the small package home delivery business. We are not worried. 

While Amazon’s long-term objectives are far from clear, their current delivery targets appear to be limited to locations in close proximity to major distribution centers. In the meantime, Amazon is one UPS’s biggest customers.

Meantime, UPS ranked among Forbes’ list of America’s Most Reputable Companies, Interbrand’s Best Global Brands and Millward Brown’s Most Valuable Global Brands

UPS has invested $110 million in the UPS Foundation that promotes community safety, diversity and environmental issues. No wonder it all works so well. UPS is just a good corporate citizen.

We love rock solid investments like UPS especially with a fast growing pearl called e-commerce locked inside. 

Meanwhile, the stock offers an excellent total return. Selling for 18 times forecast 2016 profits, the stock is below the overall market of 21. In addition, the $3.12 dividend provides a solid 3% yield. Altogether, UPS truly delivers.

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By Todd Shaver, Editor of BullMarket.com

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