Is UPS a high-quality business?

AlphaMadera's AlphaQuality grade scores United Parcel Service, Inc. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how UPS compares to a Buffett-style quality bar.

What is United Parcel Service, Inc.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to UPS based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes UPS a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

UPS - United Parcel Service, Inc.

Price: -- -- | CONSENSUS: Hold DETAILS | PRICE TARGET: $115.23 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Stable Earnings Power

AlphaQuality — archetype-weighted quantitative grade

B- 62.1 / 100 composite

Composite Grade

Composite of six pillars weighted for stable earnings power businesses. Purely quantitative — no stock price or analyst input.

Profitability

Weight: 20%

B- 67.8

5yr Avg ROIC 18.9% 89/100
Operating Margin Trend -1.13 pp/yr 17/100

Capital Efficiency

Weight: 15%

A 92.0

5yr Avg ROE 52.4% 100/100
5yr Share-Count CAGR -0.8% 77/100

Growth Quality

Weight: 15%

F 18.9

5yr Revenue CAGR -2.3% 15/100
5yr EPS CAGR -18.2% 0/100
Revenue-Growth Years (5) 3/5 60/100

Cash Generation

Weight: 15%

B 72.3

5yr FCF Margin 7.7% 61/100
5yr FCF/NI Conversion 0.87x 87/100

Balance Sheet

Weight: 20%

B 72.6

Net Debt / EBITDA 2.16x 67/100
Interest Coverage (EBIT/Int) 8.38x 79/100
Altman Z-Score 2.92 76/100

Stability

Weight: 15%

D+ 43.1

EPS Volatility (σ/μ) 0.56 25/100
Piotroski F-Score 5 56/100
Negative-Revenue Years (5) 2/5 60/100

4 of 4 gurus held; 1 added; 3 trimmed.

Holders: 4
Avg Δ position: -20.8%
New buys: 0
Full exits: 0

Dalio decreased -75%
Cooperman decreased -26%
Wood increased +21%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (20%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (15%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (15%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (20%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (15%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.