Why FedEx Has UPS Beat
May 24, 2013 3:10 PM ET | About: FedEx Corporation (FDX), UPS
One of the greatest and most well known rivalries in America is United Parcel Service (NYSE:UPS) versus FedEx (NYSE:FDX). These two corporations are competing fiercely for customers in the transportation services industry.
Performance and Operations
The last reported annual revenue of UPS was an impressive $54.42 billion. FedEx, on the other hand, "only" notched $43.86 billion. At first glance, one is likely to think that UPS is the more dominant of the two companies. But with further examination, something quite phenomenal can be seen. Despite the fact that UPS made $10 billion dollars more in revenue than FedEx, the latter company still manages to bring in a greater profit. The net income reported by FedEx was $1.80 billion compared with $874 million for UPS. This, without a doubt, shows that FedEx is providing greater value to shareholders. Hence FedEx's earnings per share of 5.71 compared with the humbling 0.90 for UPS.
In the past 10 years, UPS has seen net income jumping around somewhat unpredictably. It has fallen and risen numerous times, and currently seems to be spiraling downward. FedEx, on the other hand, took only one tumble around 2008-2009, and has otherwise experienced consistent and impressive growth, which seems to be a pattern that is currently active for the company.