UPS Deliveries as a Leading Market Indicator

December 30, 2013

Elaine's Idle Mind

UPS's Quarterly Earnings Rise 48 Percent

Other than this current year, UPS has historically been quite decent at predicting seasonal shipping volume. But is seasonal shipping volume good at predicting other things? Let’s find out.

Here we have UPS’s average US daily volume by quarter and the year-over-year change. Every year, during Q4, delivery numbers jump due to holiday shipping.

ups avg daily volume

The last data point for 2013 Q4 is made up by me — In a late-October press release, UPS predicted that daily volume would increase by 8% this year. The fact that package volume exceeded their shipping capacity over the holidays implies that the daily volume in fact increased by more than 8%. Let’s guess, I don’t know, 8.5%.

And now we have the UPS year-over-year percentage change overlaid with the S&P500 year-over-year percentage change. UPS quarterly data points are shown as x’s because the data are less frequent.

sp500 vs ups

The S&P500 is quite a…

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UPS Deliveries as a Leading Market Indicator

December 30, 2013

UPS's Quarterly Earnings Rise 48 Percent

Other than this current year, UPS has historically been quite decent at predicting seasonal shipping volume. But is seasonal shipping volume good at predicting other things? Let’s find out.

Here we have UPS’s average US daily volume by quarter and the year-over-year change. Every year, during Q4, delivery numbers jump due to holiday shipping.

ups avg daily volume

The last data point for 2013 Q4 is made up by me — In a late-October press release, UPS predicted that daily volume would increase by 8% this year. The fact that package volume exceeded their shipping capacity over the holidays implies that the daily volume in fact increased by more than 8%. Let’s guess, I don’t know, 8.5%.

And now we have the UPS year-over-year percentage change overlaid with the S&P500 year-over-year percentage change. UPS quarterly data points are shown as x’s because the data are less frequent.

sp500 vs ups

The S&P500 is quite a broad index, however. Here we look at just the consumer discretionary sector, as indexed by SPDR in their ETF (XLY).

xly vs ups yoy

Does one track the other? I don’t know, but I need to get back to work before I get fired.

UPS will release 4th Quarter results on January 30, 2014.

Source: UPS Quarterly Results


Being Contrarian

December 26, 2013

Elaine's Idle Mind

Sometimes, an equity is so beloved that there’s no one left to buy it. I’m looking at you, late-2012 AAPL. I’m also looking at YOU, priceline.com, with your 97.8% institutional ownership.

Deep thoughts from S&P Capital IQ Chief Equity Strategist Sam Stovall: “If everybody’s optimistic, who is left to buy? If everybody’s pessimistic, who’s left to sell?”

In 2012, the best-performing sector was Financials. In prior years, everyone hated real estate and bank stocks so much that they couldn’t possibly hate it any more.

In 2013, the best-performing industries were Semiconductor Memory and Solar. We’ve been bearish on solid-state anything since Solyndra died in 2011.

When all the experts and forecasts agree, something else is going to happen.

If you bought the 10 stocks in the S&P 500 with the most sell ratings at the beginning of the year, equally weighted, you would have been up 75%…

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