Hello,
A bit stumped on this question. Please help.
Thank you
Analyze the data in Exhibit 5, comparing the data for the two companies. Explain why you think the stock prices of the two companies have behaved the way they have. Explain why the market has assigned a higher price/earnings ratio to FedEx than it has to UPS Exhibit 5 The Battle for Value, 2016: FedEx Corp. versus United Parcel Service, Inc. Financial and Market Performance 2014 FedEx 2015 2012 2013 Stock price, Dec. 31 close Dividends declared in dollars per share Basic EPS (period ending May 31) Common shares outstanding (millions) Price/earnings 143.77 173.66 148.99 91.72 0.52 0.56 0.6 0.8 3.7 8.61 7.56 6.44 287.0 282.4 317.0 318.0 14.7 27.8 22.0 37.9 -13.7 % Annual return 57.4% 21.2% Cumul. annual return 57.4% 78.6% 64.8% 2014 2015 UPS 2012 2013 Stock price, Dec. 31 close Dividends declared in dollars per share Basic EPS (period ending May 31) Common shares outstanding (millions) Price/carnings 111.17 73.73 105.08 96.23 2.28 2.48 2.68 2.92 4.65 3.31 5.38 0.84 953.0 924.0 905.0 886.0 88.5 67.1 27.6 22.0 45.9% 8.3% -10.8% Annual return 45.9% 54.2% Cumul, annual return 43.4% 2015 2012 2013 2014 Standard&Poor's 500 Index Index level, Dec. 31 close 1,426.19 1,848.36 2058.90 2,043.94 11.4% Annual return 29.6% 0,7% Cumul. annual return 296% 40.3% 41.0% Darces Gogle Finiace Momingstar, anil t IQ Analyze the data in Exhibit 5, comparing the data for the two companies. Explain why you think the stock prices of the two companies have behaved the way they have. Explain why the market has assigned a higher price/earnings ratio to FedEx than it has to UPS Exhibit 5 The Battle for Value, 2016: FedEx Corp. versus United Parcel Service, Inc. Financial and Market Performance 2014 FedEx 2015 2012 2013 Stock price, Dec. 31 close Dividends declared in dollars per share Basic EPS (period ending May 31) Common shares outstanding (millions) Price/earnings 143.77 173.66 148.99 91.72 0.52 0.56 0.6 0.8 3.7 8.61 7.56 6.44 287.0 282.4 317.0 318.0 14.7 27.8 22.0 37.9 -13.7 % Annual return 57.4% 21.2% Cumul. annual return 57.4% 78.6% 64.8% 2014 2015 UPS 2012 2013 Stock price, Dec. 31 close Dividends declared in dollars per share Basic EPS (period ending May 31) Common shares outstanding (millions) Price/carnings 111.17 73.73 105.08 96.23 2.28 2.48 2.68 2.92 4.65 3.31 5.38 0.84 953.0 924.0 905.0 886.0 88.5 67.1 27.6 22.0 45.9% 8.3% -10.8% Annual return 45.9% 54.2% Cumul, annual return 43.4% 2015 2012 2013 2014 Standard&Poor's 500 Index Index level, Dec. 31 close 1,426.19 1,848.36 2058.90 2,043.94 11.4% Annual return 29.6% 0,7% Cumul. annual return 296% 40.3% 41.0% Darces Gogle Finiace Momingstar, anil t
