Buy on the dip? Or are the bears in charge? UPS is down about 18% year-over-year, and down 9% in the last month alone. It’s a stodgy stalwart kind of choice, but the 4% dividend yield was enough to tempt me into the buy team recently.
The company’s fundamentals seem solid to me. Trade wars and other economic concerns may be weighing on the stock at the moment, but growth in e-commerce will likely fuel growth for demand in UPS’s delivery services. The P/E ratio of 18, plus a forward estimated P/E of just under 13% seem attractive. The company also boasts strong cash flow, profit margin and debt service statistics.
My timing may have been off (I bought last week. The shares have continued to slide.) But I have a good feel for this pick. UPS I think is poised to benefit from marketplace trends for the foreseeable future and is pursuing overseas growth opportunities. And like I say, a 4% dividend yield is nothing to sneeze at these days.
Dividend Pick of the Week 