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Why UPS Is Poised to Outperform

By Brian D. Pacampara, CFA - Apr 5, 2013 at 11:46AM

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Market-trouncing returns could be written in this 4-Star.

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, package delivery giant United Parcel Service (UPS 0.51%) has earned a respected four-star ranking.

With that in mind, let's take a closer look at UPS and see what CAPS investors are saying about the stock right now.

UPS facts

Headquarters (founded)

Atlanta (1907)

Market Cap

$78.8 billion

Industry

Air freight and logistics

Trailing-12-Month Revenue

$54.1 billion

Management

Chairman/CEO D. Scott Davis (since 2008)

CFO Kurt Kuehn (since 2008)

Return on Capital (average, past 3 years)

35.4%

Cash/Debt

$7.9 billion / $12.9 billion

Dividend Yield

2.9%

Competitors

FedEx

United States Postal Service

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 88% of the 1,816 members who have rated UPS believe the stock will outperform the S&P 500 going forward.

Just yesterday, one of those Fools, 3ni278aosdj8hebj, touched on the tailwinds working in UPS' favor:

As the postal service does worse, its competitors will do better. While the market goes through its cycles, people will turn to companies like UPS for stability in their portfolios. Amazon may not always be the powerhouse when it comes to online shopping, as long as eBay is a viable competitor, and what's stopping Google from trying to take a slice of Amazon's pie?

For better or worse, society is turning more and more toward online shopping -- and as they do they're helping UPS grow.

Want to see how well (or not so well) the stocks in this series are performing? Follow the TrackPoisedTo CAPS account.

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Stocks Mentioned

United Parcel Service, Inc. Stock Quote
United Parcel Service, Inc.
UPS
$178.04 (0.51%) $0.91

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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