Logistics Weekly Review: FedEx, UPS

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UPS: United Parcel Service logo
UPS
United Parcel Service

For FedEx (NYSE:FDX) and United Parcel Service (NYSE:UPS), the most notable news during the week was the entry of a new participant in the package delivery business. Waffle House, a breakfast food chain, has partnered with Roadie, a startup, to provide an app-based platform that will help connect people looking to get packages delivered and people driving that route, who can then exchange the package at a Waffle House restaurant. [1] The service has made around 50 deliveries to date. However, it seems unlikely that the app-based service will be able to compete with logistics giants FedEx and UPS, since it may turn out to be more expensive than FedEx and UPS.

Below we take quick look at other notable events that took place during the week.

FedEx

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Earlier in the week, FedEx refused to ship Defense Distributed’s new product, Ghost Gunner, which allows owners to 3D-print lower receivers of an AR-15 semi-automatic rifle without any embedded serial numbers. [2] FedEx denied service, stating that it was uncertain about regulations pertaining to the device.

FedEx’s stock declined around 1.6% over the week through Thursday. We currently have a price estimate of $164 for FedEx. For the year 2015, we estimate revenues of $48.0 billion, compared to a consensus estimate of $47.7 billion, and EPS of $8.70, compared to a consensus estimate of $8.90.

Click here to see our complete analysis of FedEx

UPS

UPS was presented the Climate Leadership Award by the U.S. Environmental Protection Agency (EPA) Center for Corporate Climate Leadership. [3] The award recognizes UPS’ efforts to reduce greenhouse gas emissions. UPS has already achieved its goal of reducing carbon intensity by 10% and is now looking to further reduce it by 20% by 2020.

UPS’ stock was stagnant over the week through Thursday. We currently have a price estimate of $112 for UPS.

Click here to see our complete analysis of UPS

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Notes:
  1. U.S. Postal Service, FedEx Have New Competition…from Waffle House, February 24, 2015, www.fiscaltimes.com []
  2. FedEx won’t ship the box that makes homemade metal semi-automatic rifles, February 25, 2015, www.arstechnica.com []
  3. UPS Named Climate Leadership Award Winner by EPA, February 25, 2015, www.ups.com []