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... Statement of the Problem:
Federal Express and United Parcel Service are two of the most aggressive competitors in the express delivery market. ... The total asset turnover ratio is an important measure that can be used to evaluate the performance of both FedEx and UPS. ... For FedEx and UPS, the total asset turnover is 1. ... UPS has a higher total asset turnover than FedEx, which suggests that the firm is making better use of its current and fixed assets. Although UPS does have the highest total asset turnover, it has a much lower working capital turnover and fixed asset turnover (see appendix, figure 1). ... This ratio can be compared to UPS’s $78. ... In order for UPS to remain competitive they may need to sell off some of the assets that are not generating as much sales. ... From 1989 to 1994, UPS has maintained a consistent debt-equity ratio range of 0. ... Figure 2 of the appendix shows that in 1994, the ratios for FedEx and UPS are 0. ... Although FedEx has the higher ratio, which isn’t perceived as “good”, it makes better utilization of its assets than UPS (i. ... In all three profitability measures, UPS had the highest margin and returns in 1994 (see appendix, figure 3). UPS is therefore a more profitable company than FedEx at this time and has consistently been over the past decade.
Approximate Word count = 1042
Approximate Pages = 4.2
(250 words per page double spaced)
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