Post of the Day
November 3, 1999
United Parcel Service
Posts selected for this feature rarely stand alone. They are usually a part of an ongoing thread, and are out of context when presented here. The material should be read in that light.
There Are Only Two Important Days
While many are planning to closely track UPS stock performance over the next several months, I for one am choosing to almost totally ignore it.
I would like to make a case that there really are only two days in the next five months in which share price is important to current UPS shareowners (one additional day if you are a UPS manager).
November 9 � the offer price will be set. For current shareowners, this will determine how much cash UPS has for the tender offer. For UPS managers, this will be used to determine the number of shares used in calculating your MIP and the purchase price for the stock option program.
The day the price is fixed for the MIP awards (sometime in December). This is only of importance to management people in that it will determine the taxable income amount for this year's MIP.
The day the price is fixed for the tender offer(January/February?). The cash UPS received in November will be divided by the tender offer price to determine the number of shares UPS is willing to buy from Class A shareholders who are willing to sell. If the tender price is significantly higher than the offer price, fewer shares will be purchased and earnings per share (eps) will be diluted accordingly.
Once April 10 comes, the only important day for me to check the share price is the day of my annual portfolio analysis when I decide whether to further diversify and if so, how much.
So while others are doing daily recalculations of their net worth, I'm going to foolishly invest my energies on all the blessings I have; a good family, good health, and a good job.