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The shippers are competing for an ever expanding volume as e-commerce growth rate is still healthy. There is room for some level of competition. The day may eventually come when margins gets squeezed but that could be well in the future. A recession could cause that of course. Their software is certainly no insurmountable moat. Their logistical system is no small feat to build. If it was easy Amazon would have already done it a few years ago rather than just cherry pick the regions they wish to service themselves.
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sold both BAC and CVS that I had been holding for a long time, redeployed into BMY and ABBV.
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I don't see Amazon Air as a serious threat to FDX or UPS any time soon. They operate very differently (Amazon is just pre-positioning products near distribution centers). Also, compared to FDX's operations, Amazon Air is 1/10 the fleet size of FedEx mainline (excluding Feeder), and Amazon serves a less than a quarter of the markets FDX does, with half the fleet utilization. Perhaps someday what Amazon Air is building in Cincinnati will undercut what FDX has built at Memphis and UPS at Louisville, but that day is a long way off.
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(07-24-2019, 09:29 PM)stockguru Wrote: I don’t believe that at all. They been saying that for years. The truth is no one can compete with FDX or UPS. There logistics and software can’t be matched. Ebay has a lot of competitors they need to worry about. All those apps you see like offer up, facebook marketplace and Letgo will take market share away from them. It’s free to list and no shipping needed. eBay doesn’t scare me at all. People can gun for FDX but in the end everyone needs them one way or another.
The point here isn't just eBay.
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I didn’t say it was just Ebay. It’s all of e-commerce. But There’s room for other parties in the industry. My point is I’m not worried. FDX will always have business and they are the leaders in the US and overseas. Sure other companies can try and go on their own with shipping. But it’s a lot harder then they think. By the time someone figure it out FDX will be over $200. Every industry has competition. That’s what makes a business and to succeed you keep Innovating.
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Trying to build a cargo/logistics firm from scratch to take on FDX and UPS would be like trying to build an airline from scratch to take on American/Delta/United. There is a huge moat. Unless someone invents teleportation or perfects cheap 3D printing (essentially Star Trek replicators), these companies are not really susceptible to disruption by an app or some creative thinking. It will take burning a lot of investment capital to take them on successfully.
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(07-25-2019, 10:45 AM)stockguru Wrote: I didn’t say it was just Ebay. It’s all of e-commerce. But There’s room for other parties in the industry. My point is I’m not worried. FDX will always have business and they are the leaders in the US and overseas. Sure other companies can try and go on their own with shipping. But it’s a lot harder then they think. By the time someone figure it out FDX will be over $200. Every industry has competition. That’s what makes a business and to succeed you keep Innovating.
Great, thank you for sharing your insights.
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Sold out of a bond fund (NXP)
Replaced it with a mix of CTBI, F, LYB, and OZK. OZK is a new position. 23 years of dividend growth, 3.2% current yield, 5yr average dividend growth rate of 17.2%, 29% payout ratio, and a P/E of 9 (well-below its 10yr average of 18.2).
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Sorry for the delay, I bought these a week ago or so:
Bought Starter Position in BMY @ 44.05
Bought Starter Position in PCI @ 24.39
BMY currently has above average dividend and value due to factors I'm willing to live with (the merger with Celgene).
PCI is my second CEF purchase. This purchase is more about learning than hitting a home-run.
Thank You,
Paul
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added to my IRM position
been doing so when it's under $30
New to the forum, and my newest purchase was Iron Mountain, IRM. Not a forever purchase, as we move more and more data to the cloud, but for now, excellent dividend.
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