Tag Archives: UPS

by | October 22, 2019 · 7:00 pm

Fast delivery is very important to some e-commerce Giants

Amazon is expected to report earnings on Thursday 24 after market close, and the consensus EPS forecast for the quarter is $4,46, and that is below the reported earnings for the same quarter last year that came in at $5,75.

I have been watching Amazon for two decades and it`s a big surprice to see that the company is still interesting. The company has been growing since the late 90`s and have now become a huge conglomerate with many businesses on top of its core business.

Amazon increased the shipping cost but what happens when its drones are taking over?

Cloud computing is one of the biggest winners at the conglomerate at the moment, and that`s also one of the biggest reasons why investors are holding their shares. It`s not their e-commerce business I`m looking at right now. It`s simply AWS (Amazon Web Services).

AWS made up about two-thirds of Amazon`s operating income last quarter. 13% of Amazon`s revenue comes from AWS. This is one of the most interesting part of the conglomerate with its great business model.

AWS grew 49% in the same quarter last year, and last quarter AWS reported a 37% growth and that is still a very great number. But it costs. Last quarter, Amazon reported that they had invested heavily in AWS.

Amazon added more personnel to the marketing team as well as the AWS`s technical team. Money makes money, and these investments should pay off in the long run.

Amazon have big competitors out there and one of the biggest are Rakuten in Japan and Alibaba in China. I receive many packages from them all and free and fast delivery is critical important to them all.

Jeff Bezos knows it and that`s why they now are in direct competition with FedEx and UPS to name a few. Amazon have recently started to ship third-party goods through its own logistics system, and that`s probably why FedEx made a decision to cut ties with them. This is probably why FedEx also reported negative results in its recent earnings.

According to Rakuten, Amazon has gone from shipping 15% of its own packages in 2017 to 50% today. Will they continue to ship its own packages through its own logistics system, and what is the percentage?

The shipping cost accelerated and can increase. On top of that Amazon still have its one-day shipping strategy which is a strategy not all of the e-commerce giants can follow up. I receive many packages from Ebay and sometimes it can take weeks and months to see the item arrive. But they have a different strategy.

Investors should look at it in the long run and keep in mind that the shipping cost can drop when the drones are coming to play the game. But it remain to see when that is happening.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | November 30, 2015 · 10:55 pm

Amazon revealed its new drone while online shopping is increasing

We can see a clear picture here. The busiest day of the year, Black Friday is declining while online retailers see sales are jumping. Black Friday sales fall nearly 11% from last year. How is it gonna be today; on Cyber Monday?

Some shops starts the sale the day before Black Friday and that can be a reason, but if you look at Thanksgiving, it also dropped this year by nearly 11%. Other retailers are offering bargains long before Thanksgiving and that can be another reason to the decline.

The biggest reason I think, is the increased online shopping which jumped 14,3% on Friday from last year. Many people doesn`t want to participate in the wild shopping crowds and prefer rather to shop online than in stores.

It`s Cyber Monday today and the term was created by marketing companies to persuade people to shop online. I wrote about both Black Friday and Cyber Monday in 2013, but nobody knew what it was. Now, many knows what Black Friday is but still today no one know what Cyber Monday is.

It`s probably to early for people in Europe. Cyber Monday made its debut on November 28, 2005, and quickly became one of the biggest online shopping days of the year. The trend is driving serious online discounts and promotions on Cyber Monday.

Thanksgiving, Black Friday and Cyber Monday means busy days for Amazon that revealed the latest prototype of drones.

 

 

Amazon are planning to deliver packages in under 30 minutes. The new drones weigh 55 pounds and can deliver packages weighing up to 5 pounds. Amazon has many prototypes, and they are ready to launch the service once the company has the «regulatory support.»

Google revealed that it wants to launch a drone service in 2017, while Walmart said they are now starting drone testing.

What about FedEx, UPS and DHL?

 

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication. UA-63539824-1.

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by | March 17, 2015 · 5:58 pm

FedEx report on Wednesday morning

FedEx (FDX) is set to report fourth quarter earnings on Wednesday morning before the market open. Their rival UPS guided lower for its holiday period in January. According to some analysts, FedEx is in an «enviable possition» in the small package market.

Analysts say that the company`s cash levels are at an all time high, and their operations and fundamentals are extremely strong and suggest the potential for earnings and guidance upside. The company`s free cash flow has been a source of frustration for their shareholders in the past.

FedEx-Truck

Both FedEx and UPS are trading at about 4,6 percent free cash flow (FCF) yields based on 2016 estimates, but it is expected to see FedEx`s growth profile justifies the stock trading at a premium to UPS.

FedEx`s acquisition of Genco is fully funded and they can spend their $1 billion in a faster buyback or another acquisition. Growth expectations for FedEx are higher than their rival UPS, but UPS can be a better stock if you need income in the near future.

FedEx`s dividend yield is extremely low at 0,45 percent. If they continue to pay small dividends, they will have plenty of cash to buy back large amounts of its own shares and that will boost their own EPS.

I have talked about the transportation sector many times, and FedEx is one of them in this sector. The stock is up over 20 percent since last year, and the increase in price has pushed the dividend yield down to only 0,45 percent.

The street expected adjusted EPS of $1,87 on revenue of $11,79 billion. For Q4, adjusted EPS was estimated at $2,86 on revenue of $12,31 billion. Full year EPS was expected at $8,97 on revenue of $47,74 billion.

FedEx isn`t going to tell the market what they don`t already know on Wednesday. A better-than-expected earnings report could push the stock price up and above its 52-week high.

They cut costs in the express business to make up for lower volume, but that is not the way to grow. A resurgent U.S economy now affords the company a change to have its ground segment do all the heavy lifting for margins and profits.

The global economy is slow and so are China. A slower growth Chinese economy depends more on internal consumption and less on exports and that has been weighing on FedEx`s express segments for years.

Asia is slow, the U.S is picking up and the Europe is all about unfavorable foreign exchange. How will this impact the shares of FedEx? Let`s see on Wednesday. Expectations would put the company on track to reach its yearly goal of $8,50 to $9,00 in EPS. P/E is 22,48.

FedEx Corporation is now trading at $178,02. Up 0,39 percent.

 

 

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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