Analyzing United Parcel Service (NYSE:UPS) & Cargojet (OTCMKTS:CGJTF)

Posted by Defense World Staff on Aug 9th, 2023

Cargojet (OTCMKTS:CGJTF – Get Free Report) and United Parcel Service (NYSE:UPS – Get Free Report) are both industrials companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, valuation, analyst recommendations, profitability, institutional ownership, earnings and risk.

Profitability

This table compares Cargojet and United Parcel Service’s net margins, return on equity and return on assets.

Net Margins	Return on Equity	Return on Assets
Cargojet	N/A	N/A	N/A
United Parcel Service	10.90%	57.68%	14.91%

Institutional and Insider Ownership

17.2% of Cargojet shares are owned by institutional investors. Comparatively, 58.9% of United Parcel Service shares are owned by institutional investors. 0.1% of United Parcel Service shares are owned by company 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.

Analyst Ratings

This is a summary of current recommendations for Cargojet and United Parcel Service, as reported by MarketBeat.com.

Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cargojet	0	0	0	0	N/A
United Parcel Service	3	8	9	1	2.38

Cargojet presently has a consensus target price of $166.14, suggesting a potential upside of 132.02%. United Parcel Service has a consensus target price of $190.29, suggesting a potential upside of 5.37%. Given Cargojet’s higher possible upside, analysts plainly believe Cargojet is more favorable than United Parcel Service.

Valuation and Earnings

This table compares Cargojet and United Parcel Service’s revenue, earnings per share (EPS) and valuation.

Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cargojet	N/A	N/A	N/A	($0.25)	-286.47
United Parcel Service	$100.34 billion	1.55	$11.55 billion	$12.36	14.61

United Parcel Service has higher revenue and earnings than Cargojet. Cargojet 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.

Dividends

Cargojet pays an annual dividend of $0.60 per share and has a dividend yield of 0.8%. United Parcel Service pays an annual dividend of $6.48 per share and has a dividend yield of 3.6%. Cargojet pays out -238.6% of its earnings in the form of a dividend. United Parcel Service pays out 52.4% 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 raised its dividend for 14 consecutive years. United Parcel Service is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

United Parcel Service beats Cargojet on 12 of the 14 factors compared between the two stocks.

About Cargojet

(Get Free Report)

Cargojet Inc. provides time sensitive overnight air cargo services in Canada. It operates domestic air cargo network services between 16 Canadian cities; and provides dedicated aircraft to customers on an aircraft, crew, maintenance, and insurance basis operating between points in Canada, North and South America, and Europe. The company also operates scheduled international routes for various cargo customers between the United States and Bermuda; and between Canada, the United Kingdom, and Germany. In addition, it offers aircraft to customers on an ad hoc charter basis operating between points in Canada, the United States, and other international destinations; and specialty charter services for livestock shipments, military equipment movements, emergency relief supplies, and virtually large shipments across North America, South America, the Caribbean, and Europe. Further, the company is involved in the aircraft operation and maintenance, flight planning and dispatch, crew planning and training, ground handling, and commercial airline cargo management businesses. As of December 31, 2022, it operated a fleet of 39 aircraft. The company was founded in 2001 and is headquartered in Mississauga, Canada.

About United Parcel Service

(Get Free Report)

United Parcel Service, Inc., a package delivery company, provides transportation and delivery, distribution, contract logistics, ocean freight, airfreight, customs brokerage, and insurance services. It operates through two segments, U.S. Domestic Package and International Package. The U.S. Domestic Package segment offers time-definite delivery of letters, documents, small packages, and palletized freight through air and ground services in the United States. The International Package segment provides guaranteed day and time-definite international shipping services comprising guaranteed time-definite express options in Europe, Asia, the Indian sub-continent, the Middle East, Africa, Canada, and Latin America. The company also provides international air and ocean freight forwarding, post-sales, and mail and consulting services. In addition, it offers truckload brokerage services; supply chain solutions to the healthcare and life sciences industries; financial and information services; and fulfillment and transportation management services. United Parcel Service, Inc. was founded in 1907 and is headquartered in Atlanta, Georgia.

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