United Parcel Service (NYSE: UPS) and International Consoltd Airlns Grp (OTCMKTS:ICAGY) are both transportation companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, dividends, institutional ownership, valuation and risk.
Institutional & Insider Ownership
54.1% of United Parcel Service shares are held by institutional investors. Comparatively, 0.1% of International Consoltd Airlns Grp shares are held by institutional investors. 0.6% of United Parcel Service shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
This table compares United Parcel Service and International Consoltd Airlns Grp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|United Parcel Service||7.45%||477.77%||12.76%|
|International Consoltd Airlns Grp||8.96%||139.43%||25.09%|
Risk and Volatility
United Parcel Service has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500. Comparatively, International Consoltd Airlns Grp has a beta of 1.07, indicating that its share price is 7% more volatile than the S&P 500.
Earnings and Valuation
This table compares United Parcel Service and International Consoltd Airlns Grp’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|United Parcel Service||$65.87 billion||1.36||$4.91 billion||$5.62||18.44|
|International Consoltd Airlns Grp||$25.95 billion||0.27||$2.26 billion||$4.59||3.75|
United Parcel Service has higher revenue and earnings than International Consoltd Airlns Grp. International Consoltd Airlns Grp is trading at a lower price-to-earnings ratio than United Parcel Service, indicating that it is currently the more affordable of the two stocks.
United Parcel Service pays an annual dividend of $3.64 per share and has a dividend yield of 3.5%. International Consoltd Airlns Grp pays an annual dividend of $0.43 per share and has a dividend yield of 2.5%. United Parcel Service pays out 64.8% of its earnings in the form of a dividend. International Consoltd Airlns Grp pays out 9.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. United Parcel Service has increased its dividend for 8 consecutive years. United Parcel Service is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a breakdown of recent recommendations for United Parcel Service and International Consoltd Airlns Grp, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|United Parcel Service||1||9||7||0||2.35|
|International Consoltd Airlns Grp||1||4||2||0||2.14|
United Parcel Service presently has a consensus price target of $124.07, suggesting a potential upside of 19.74%. Given United Parcel Service’s stronger consensus rating and higher possible upside, equities analysts clearly believe United Parcel Service is more favorable than International Consoltd Airlns Grp.
United Parcel Service beats International Consoltd Airlns Grp on 13 of the 17 factors compared between the two stocks.
About United Parcel Service
United Parcel Service, Inc. (UPS) is a package delivery company. The Company is a provider of global supply chain management solutions. The Company operates through three segments: U.S. Domestic Package operations, International Package operations, and Supply Chain & Freight operations. As of December 31, 2016, the Company delivered packages in over 220 countries and territories. The Company offers a spectrum of the United States domestic guaranteed ground and air package transportation services. The International Package segment includes the small package operations in Europe, Asia-Pacific, Canada and Latin America, the Indian sub-continent, the Middle East and Africa. The Supply Chain & Freight segment includes its forwarding and logistics services, truckload freight brokerage, UPS Freight and its financial offerings through UPS Capital. The Company serves the global market for logistics services, which include transportation, distribution, contract logistics and ground freight.
About International Consoltd Airlns Grp
International Consolidated Airlines Group, S.A. is an airline company that holds the interests in airline and ancillary operations. Its segments include British Airways, Iberia, Vueling, Aer Lingus and Other Group companies. It combines the airlines in the United Kingdom, Spain and Ireland. It has approximately 550 aircrafts to over 280 destinations. The Company operates various aircraft fleet services, including Airbus A318, Airbus A319, Airbus A340-600, Boeing 787-800, Embraer E190 and Boeing 777-200, among others. The Company, through its subsidiaries, is engaged in providing airline marketing, airline operations, insurance, aircraft maintenance, storage and custody services, air freight operations and cargo transport services. The Company offers its services in cities, including London, Madrid, Barcelona, Rome and Dublin. The Company’s brands include British Airways, Iberia, Vueling, Aer Lingus, IAG Cargo and Avios.
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