Business Case Studies & Business Publications

FedEx Corp. versus United Parcel Service...

Bruner, Robert F.,...

Case

FedEx Corp. versus United Parcel Service of America, Inc.: Who Will Deliver Returns from China?

Bruner, Robert F.; Lipson, Marc L.; Carr, Sean

F-1601 | Published September 3, 2009 | 14 pages Case

Collection: Darden School of Business

Add To Cart Buy Now

Product Details

In early 2006, the anticipated expansion of package delivery services in China provided a great opportunity for the two package delivery giants FedEx and UPS. It was unclear which of these firms would make the most of this opportunity. An analysis of financial performance suggests that UPS is the better performer. On the other hand, the FedEx stock price performance has been far stronger. This apparent conflict highlights the fact that stock prices reflect anticipated future performance and new information. A teaching note and instructor and student spreadsheets are available.

The learning objectives for this case are to utilized financial ratios to evaluate operating performance; to explore stock price performance measures; to illustrate the central valuation model which holds that current prices reflect future (discounted) performance; and to explore strategic capabilities in the context of a particular market. This case provides an excellent introduction to any finance curriculum and requires only a modest familiarity with finance concepts.