United Parcel Service, Inc. (UPS) Stock Valuation — PE Analysis
Integrated Freight & Logistics · NYSE
Current Price
$104.69
PE Ratio (TTM)
16.2x
Intrinsic Value
$98.86
-5.9% margin of safety
COMPETITIVE MOAT
↑Extensive Global Network
UPS operates a vast, integrated network of hubs, vehicles, and aircraft. This physical infrastructure creates significant barriers to entry for new competitors.
↑Brand Recognition and Trust
UPS is a globally recognized brand synonymous with reliable package delivery. This established trust translates into customer loyalty and preference.
↑Economies of Scale
The sheer volume of packages processed allows UPS to achieve significant cost efficiencies. This scale advantage enables competitive pricing and operational leverage.
INVESTMENT RISKS
↓Intense Industry Competition
The integrated freight and logistics sector is highly competitive, with players like FedEx and Amazon Logistics constantly vying for market share. This can pressure pricing and margins.
↓Labor Relations and Costs
UPS relies heavily on a large workforce, making it susceptible to labor disputes and rising wage pressures. Contract negotiations can significantly impact operational costs.
↓Economic Sensitivity
Package volume is closely tied to overall economic activity. A recession or slowdown in consumer spending can directly reduce UPS's revenue and profitability.
Base case
UPS base case PE valuation
A base case PE valuation for UPS estimates a fair value of about $98.86 per share, against a current price of $104.69. The model assumes 3.7% annual earnings growth, a 19x target PE multiple, and a 10% discount rate.
Intrinsic Value
$98.86
Margin of safety
-5.9%
Expected annual return
-1.1%
Base case assumptions: 3.7% annual earnings growth, 19x target PE, 10% discount rate, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the UPS PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for United Parcel Service, Inc. respond.
Open PE Calculator for UPSCompany Overview
United Parcel Service, Inc., a package delivery and logistics provider, offers transportation and delivery services. It operates through two segments, U.S. Domestic Package and International Package. The U.S. Domestic Package segment offers time-definite delivery services for express letters, documents, packages and palletized freight through air and ground services. The International Package segment provides small package operations in Europe, the Middle East and Africa, Canada and Latin America, and Asia. The company offers a range of guaranteed day- and time-definite international transportation services; day-definite services; cross-border ground package delivery; contract-only, e-commerce solutions for non-urgent, and cross-border shipments; and international service for urgent and palletized shipments. It also provides international air and ocean freight forwarding, contract logistics, customs brokerage and insurance, mail services, healthcare logistics, distribution, and post-sales services. United Parcel Service, Inc. was founded in 1907 and is headquartered in Atlanta, Georgia.
Financial Metrics — UPS PE Stock Valuation Data
PE Ratio (TTM)
16.2x
PEG Ratio
n/m
Earnings Yield
5.14%
ROE (TTM)
29.1%
Revenue/Share (TTM)
$105.80
Dividend Yield
6.27%
Debt/Equity
1.67x
Frequently Asked Questions
What is the PE ratio of UPS?
The trailing twelve-month PE ratio of UPS reflects how much investors pay per dollar of United Parcel Service, Inc.'s earnings. This metric is most useful when compared to Integrated Freight & Logistics peers and the company's own historical range.
Is UPS overvalued based on PE ratio?
UPS's PE of 16.2x combined with a PEG ratio of -4.35 provides a growth-adjusted perspective. UPS has negative earnings, so its PE and PEG ratios are not meaningful here and cannot tell you whether the stock is over or undervalued. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Integrated Freight & Logistics, a DCF analysis may be more appropriate.
How do I value UPS stock using PE ratio?
To value United Parcel Service, Inc. using PE: (1) Compare the current PE (16.2x) against the Integrated Freight & Logistics median to assess relative pricing, (2) check the PEG ratio (-4.35) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of UPS?
UPS's PEG ratio is -4.35, calculated by dividing the PE ratio (16.2x) by the expected earnings growth rate. Because UPS has negative earnings, its PEG ratio is not meaningful and should not be read as a sign of under or overvaluation. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for UPS stock valuation?
PE ratio gives a quick relative read — how UPS is priced versus Integrated Freight & Logistics peers. DCF provides an absolute value based on projected free cash flows. For UPS, with a strong ROE of 29.1%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See UPS DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Industrials valuationsP/E and DCF value UPS with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.