United Parcel Service Inc

Analyst Listing

The following analysts provide coverage for the subject firm as of May 2016:

Broker Analyst Analyst Email
Credit Suisse Allison M. Landry allison.landry@credit-suisse.com
Raymond James Arthur W. Hatfield art.hatfield@raymondjames.com
Susquehanna Financial Group Bascome Majors bascome.majors@sig.com
Stifel Nicolaus David G. Ross dross@stifel.com
Bernstein Research David Vernon david.vernon@bernstein.com
Avondale Partners Donald Broughton dbroughton@avondalepartnersllc.com
Cowen & Company Helane Becker helane.becker@cowen.com
Stephens Inc Jack Atkins jack.atkins@stephens.com
Buckingham Research Jeffrey Kauffman jkauffman@buckresearch.com
RBC Capital Markets John Barnes john.barnes@rbccm.com
BB&T Capital Markets Kevin W. Sterling ksterling@bbandtcm.com
Nomura Research Matt Troy matt.troy@nomura.com
William Blair Nathan Brochmann nbrochmann@williamblair.com
Deutsche Bank Research Robert Salmon robert.salmon@db.com
Wolfe Research Scott H. Group sgroup@wolferesearch.com
Oppenheimer Scott Schneeberger scott.schneeberger@opco.com

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Primary Input Data

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Derived Input Data

Derived Input

Label

2015 Value

2016
Value

Equational Form

Net Operating Profit Less Adjusted Taxes NOPLAT  4,774 3,296 NOPLAT\, =\, EBIT\, x\, (1 \,-\, Avg \,\,Tax\,\, Rate\,\, on\,\, EBIT)
Free Cash Flow FCF 5,051 4,774 FCF\,=NOPLAT\,+\,Non-Cash\,Expenses-\Delta NWC\,-\,NCS
Tax Shield TS 92 115 TS\,=\,Interest\,\,Paid\,\,x\,\, Avg \,\,Tax\,\,Rate\,\, on\,\, Pre-Tax\,\, Income
Invested Capital IC 27,615 28,647 IC\,=\,Fixed\,\,Operating\,\,Assets\,\,+\,\,Net\,\, Working\,\, Capital
Return on Invested Capital ROIC 17.29% 11.51% ROIC\,=\,\frac { NOPLAT }{ IC }
Net Investment NetInv 2,867 3,256 NetInv\,=\,{ {IC}_{1}}-{{IC}_{0}}+Depreciation
Investment Rate IR 60.05% 98.78% IR\,=\,\frac {NetInv}{NOPLAT}
Weighted Average Cost of Capital
WACCMarket 5.00% 7.20% WACC\,=\,\frac { E }{ V } { R }_{ E }\,+\,\frac { P }{ V } { R }_{ P }\,+\,\frac { D }{ V } { R }_{ D }\left( 1- Avg\,\, Tax\,\,Rate\,\,on\,\,Pre-Tax\,\,Income \right)
 WACCBook  7.62%  7.17%
Enterprise value
EVMarket 90,671 106,424 EV\,=\,Market\,\,Cap\,\,Equity\,+\,\,Long\,\,Term\,\,Debt\,-\,Cash
 EVBook  92,009  107,335
Long-Run Growth
g = IR x ROIC
10.38% 11.37% Long-run growth rates of the income variable are used in the Continuing Value portion of the valuation models.
g = % \Delta GDP  2.50%  2.50%
Margin from Operations M 12.65% 8.38% M\,\,=\,\,\frac{EBIT}{SALES}
Depreciation/Amortization Rate D 22.10% 30.49% D\,\,=\,\,\frac{D+A}{EBITDA}

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Valuation Multiple Outcomes

The outcomes presented in this study are the result of original input data, derived data, and synthesized inputs.

Equational Form

Observed Value

Single-stage

multiple g solution

Two-stage valuation

model g solution

12/31/2015 12/31/2016 12/31/2015 12/31/2016 12/31/2015 12/31/2016

EV/SALES 

\frac {EV}{Sales} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)\,(M)

 1.56  1.76  -0.38%  5.61%  -0.99%  6.10%

EV/EBITDA

\frac {EV}{EBITDA} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)\,(1\,-\,D)

9.62 14.59 -0.38% 5.61% -0.99%  6.10%

EV/NOPLAT

\frac {EV}{NOPLAT} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}

18.99 32.29 -0.38% 5.61% -0.99%  6.10%

EV/FCFOPS

\frac {EV}{FCF_{OPS}} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)

17.95 30.34 -0.38% 5.61% -0.99%  6.10%

EV/EBIT

\frac {EV}{EBIT} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)

12.34 20.99 -0.38% 5.61% -0.99%  6.10%

EV/IC

\frac {EV}{IC} \,= \,\frac{ROIC\,  -\,  g}{WACC\,-\,g}

3.28 3.72 -0.38% 5.61% -0.99%  6.10%

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