United Parcel Service (NYSE: UPS) and Hawaiian (NASDAQ:HA) are both transportation companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, profitability, risk, earnings and dividends.
Insider & Institutional Ownership
54.1% of United Parcel Service shares are held by institutional investors. Comparatively, 90.1% of Hawaiian shares are held by institutional investors. 0.6% of United Parcel Service shares are held by company insiders. Comparatively, 2.3% of Hawaiian shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
United Parcel Service has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500. Comparatively, Hawaiian has a beta of 1.54, indicating that its stock price is 54% more volatile than the S&P 500.
United Parcel Service pays an annual dividend of $3.64 per share and has a dividend yield of 3.5%. Hawaiian pays an annual dividend of $0.48 per share and has a dividend yield of 1.2%. United Parcel Service pays out 60.6% of its earnings in the form of a dividend. Hawaiian pays out 8.5% 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 increased its dividend for 8 consecutive years. United Parcel Service is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares United Parcel Service and Hawaiian’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|United Parcel Service||7.45%||477.77%||12.76%|
This is a breakdown of recent ratings and recommmendations for United Parcel Service and Hawaiian, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|United Parcel Service||1||9||7||0||2.35|
United Parcel Service currently has a consensus price target of $124.07, suggesting a potential upside of 18.54%. Hawaiian has a consensus price target of $48.42, suggesting a potential upside of 25.11%. Given Hawaiian’s higher possible upside, analysts clearly believe Hawaiian is more favorable than United Parcel Service.
Earnings and Valuation
This table compares United Parcel Service and Hawaiian’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|United Parcel Service||$65.87 billion||1.37||$4.91 billion||$6.01||17.41|
|Hawaiian||$2.70 billion||0.74||$364.04 million||$5.64||6.86|
United Parcel Service has higher revenue and earnings than Hawaiian. Hawaiian 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.
United Parcel Service beats Hawaiian on 11 of the 17 factors compared between the two stocks.
About United Parcel Service
United Parcel Service, Inc. (UPS) is a package delivery company. The Company is a provider of global supply chain management solutions. The Company operates through three segments: U.S. Domestic Package operations, International Package operations, and Supply Chain & Freight operations. As of December 31, 2016, the Company delivered packages in over 220 countries and territories. The Company offers a spectrum of the United States domestic guaranteed ground and air package transportation services. The International Package segment includes the small package operations in Europe, Asia-Pacific, Canada and Latin America, the Indian sub-continent, the Middle East and Africa. The Supply Chain & Freight segment includes its forwarding and logistics services, truckload freight brokerage, UPS Freight and its financial offerings through UPS Capital. The Company serves the global market for logistics services, which include transportation, distribution, contract logistics and ground freight.
Hawaiian Holdings, Inc. is a holding company. The Company is engaged in the scheduled air transportation of passengers and cargo amongst the Hawaiian Islands (the Neighbor Island routes), between the Hawaiian Islands and certain cities in the United States (the North America routes), and between the Hawaiian Islands and the South Pacific, Australia, New Zealand and Asia (the International routes), collectively referred to as its Scheduled Operations. It offers non-stop service to Hawai’i from United States gateway cities. As of December 31, 2016, it also provided approximately 160 daily flights between the Hawaiian Islands. The Company operates various charter flights. As of December 31, 2016, the Company’s fleet consisted of 20 Boeing 717-200 aircraft for the Neighbor Island routes, eight Boeing 767-300 aircraft, and 23 Airbus A330-200 aircraft for the North America, International, and charter routes.
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