Using the PEG framework with analyst consensus forward EPS growth of 19.0% plus 6.5% dividend yield, United Parcel Service, Inc. has a fair value of $134.37 based on NTM EPS (FY2026) of $7.06. The current PEG ratio is 0.72.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG works well for steady growers with predictable earnings.
| EPS Growth RateForward | 12.5% |
| Dividend Yield | +6.5% |
| Adjusted Growth (clamped 8–25%) | 19.0% |
| Fair P/E | 19.0x |
| NTM EPS (FY2026) | $7.06 |
| Fair Value | $134.37 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $6.56 | — | — |
| FY2026E | $7.06 | +7.6% | 19 |
| FY2027E | $8.02 | +13.7% | 20 |
| FY2028E | $8.70 | +8.5% | 9 |
| FY2029E | $9.98 | +14.6% | 4 |
| FY2030E | $11.83 | +18.6% | 4 |
5Y Forward EPS CAGR: 12.5%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $12.9B | $14.68 | — |
| FY2022 | $11.5B | $13.20 | -10.1% |
| FY2023 | $6.7B | $7.80 | -40.9% |
| FY2024 | $5.8B | $6.76 | -13.3% |
| FY2025 | $5.6B | $6.56 | -3.0% |
4Y Historical EPS CAGR: -18.2%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.