• Why did FedEx’s stock price outstrip UPS’s during the initiation of talks over liberalized air cargo routes between the U.S. and China? Assuming a perfectly efficient stock market, how might one interpret a 14% increase in FedEx’s market value of equity?
• How have FedEx and UPS performed since the early 1990s? Which firm is doing better? In class, prepare to discuss the insights you derived from the two firms’ financial statements, financial ratios, stock-price performance, and economic profit (economic value added or EVA). Also, prepare to describe how EVA is estimated, and its strengths and weaknesses as a measure of performance.
• If you had to identify one of those companies as excellent, which company would you choose? On what basis did you make your decision? More generally, what is excellence in business?

When the United States and China reached an agreement on air-transportation that quintupled the number of commercial cargo flights between the two countries. Only two U.S. all-cargo carriers that were permitted to serve the vast Chinese market were FedEx and the United Parcel Service, Inc. This agreement allowed for the establishment of air-cargo hubs in China and landing rights for commercial airlines at any available airport. Since news broke out both companies’ stock prices had been rising steadily. The FedEx shared price had sky rocketed at a rate nearly five times faster than UPS. The reason for that is that FedEx had the largest foreign presence in China. They had 11 weekly flights, served 220 Chinese cities and FedEx’s volumes in China had grown by more than 50% between 2003 and 2004. The way that I would interpret FedEx’s fourteen percent increase in market value is that investors view FedEx as a potential better company to take advantage of the growth in China. Then I would look into past data in order to look into the future performance