FedEx Corporation (NYSE: FDX), the arch enemy of United Parcel Service (NYSE: UPS), is set to report third-quarter earnings this Thursday, March 19. Don't expect to see any growth on the bottom line. In fact, you may count on seeing a big drop. According to the following source, at this time last year, FedEx reported Q3 earnings of $1.26 per share. Analysts expect the delivery service to do about $0.46 per share. Such performance will represent a dive of over 60%.

In reading recent stories that Warren Buffett continues to increase his stake in Burlington Northern Santa Fe (NYSE: BNI) -- now standing at 22.4% -- I started to wonder if some day the name might be changed to "Berkshire" Northern Santa Fe RR?

'My pal Warren' is no doubt looking long term, and for most of the past two years has been up on Berkshire Hathaway's (NYSE: BRK.A) BNI investment. However that is not the case today as his most recent purchase at $75.00 per share (not bought in the open market) is under water; the shares closed at $66.04, down 12%. He is losing even more on his average purchase price.

Right or wrong, I have been buying stocks on dips for the last five months, and the past two weeks I started adding naked puts to the mix on down days.

In short (no pun intended), I am opening an option to sell a stock I do not own. These "naked puts" pay me cash on the first day to accept an obligation to buy a stock in the future at a predetermined price. If the stock is one cent or greater below the strike price, it gets "put to me" and I have to cover the position by buying the shares pledged.

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Alcatel-Lucent (NYSE: ALU) reported a huge Q4 loss on a charge and the economic slowdown.
• Avon Products Inc. (NYSE: AVP) fell short of Q4 expectations but announced a dividend increase.
• Carlisle Companies Inc. (NYSE: CSL) Q4 numbers resulted in an analyst's upgrade.
• Costco Wholesale Corp. (NASDAQ: COST) warned that its earnings would fall well below expectations.
• Electronic Arts Inc. (NASDAQ: ERTS) posted a bigger-than-expected loss and outlined cost cutting plans.
• Hasbro Inc. (NYSE: HAS) shares took a hit ahead of its earnings report due to rival Mattel's Q4 results.

United Parcel Service (NYSE: UPS - option chain) shares are headed higher today after the company reported a fourth-quarter adjusted profit of 83 cents per share this morning, just missing analysts' estimates of 85 cents per share. However, UPS shares are trading higher today after the company said it will freeze management salaries and suspend its 401(k) matching program in order to cut costs. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on UPS.

UPS opened this morning at $42.70. So far today the stock has hit a low of $42.40 and a high of $45.57. As of 12:40, UPS is trading at $44.69, up 2.27 (5.3%). The chart for UPS looks neutral and S&P gives UPS a 3 STARS (out of 5) hold ranking.

United Parcel Service (NYSE: UPS) is scheduled to discuss fourth-quarter 2008 results tomorrow, February 3, in a conference call at 8:30 AM ET hosted by UPS Chairman and CEO Scott Davis and Chief Financial Officer Kurt Kuehn. You can listen in to the call via the live webcast on the company's website.

For the quarter that saw lower fuel prices, a weak holiday shopping season, and the opening of a new UPS hub in Shanghai, analysts polled by Thomson Reuters expect the Atlanta-based company to report earnings of $0.85 per share, down from $1.07 per share in the same period of the previous year. Revenue for the quarter is expected to total $13.2 billion, down 1.4% from a year ago. UPS's earnings have topped estimates in the past five quarters, by as much as 7.9%.

If you've been watching earnings this past week, or if you read last week's Week in Preview, then this coming week may leave you feeling a bit like Bill Murray in Groundhog's Day. That is, again analysts surveyed by Thomson Reuters expect earnings declines to be more frequent and deeper than earnings gains.

Motorola Inc. (NYSE: MOT), Dow Chemical Co. (NYSE: DOW), Anadarko Petroleum Corp. (NYSE: APC), IAC Interactivecorp (NASDAQ: IACI), Moody's Corp. (NYSE: MCO), Elizabeth Arden Inc. (NASDAQ: RDEN), Devon Energy Corp. (NYSE: DVN), Diebold Inc. (NYSE: DBD), Tyco International Ltd. (NYSE: TYC), United Parcel Service (NYSE: UPS), Cisco Systems Inc. (NASDAQ: CSCO), Polo Ralph Lauren Corp. (NYSE: RL), ITT Corp. (NYSE: ITT), and Walt Disney Co. (NYSE: DIS) are scheduled to report quarterly results this week, and they're all expected to report double-digit declines in earnings.

But again this week, let's take a look who Wall Street feels may have done well in the past quarter.

When oil prices were rising quarter after quarter through July of this year -- topping $147 per barrel -- it was very problematic for United Parcel Service (NYSE: UPS) to run its television commercials bragging they had the largest fleet of planes and trucks in the world.

Fuel prices that hurt the economy have hurt UPS more. The stock is down from the high $80s a few years ago to the current lows closing Monday at $52.77. It is trading below its 2001 IPO price after averaging around $70 for most of its "public life."

Just about every business journal is coming out with its stock picks for 2009, and among them are many blue chip stocks. These include familiar names like General Electric (NYSE: GE) Chasing Value: Add General Electric to the list, Johnson and Johnson (NYSE: JNJ), Microsoft (NASDAQ: MSFT), and McDonald's (NYSE: MCD), to name a few.

While I was reading this weekend I saw a UPS ad and realized that nobody was directing investor attention to this fine company.

That got me thinking. UPS has a clean balance sheet, great cash flow and is AAA rated. The company has weathered the high fuel prices and reduced business. UPS itself has become a valuable barometer over the years to measure the state of the economy and I often check with our carrier about his business traffic. On Friday he said they were laying off 10% of the drivers but he would be above the cut.

Hey, FedEx (NYSE: FDX) beat the estimates of Wall Street! That's awesome, right? Not in this case. The nemesis of United Parcel Service (NYSE: UPS) reported Q2 numbers on Thursday, and they didn't matter for the most part. What mattered more was that management seemed to be in a frantic mood over cutting costs and capital expenditures.

According to this article, FedEx only managed to deliver (yes, I used that word on purpose) a four-cent rise in earnings per share; they came in at $1.58, one penny higher than what analysts expected. Problem for FedEx is this lousy economy. The company will have a hard time ensuring that it can deliver (there's that word again) on its promised guidance for the rest of the year. Simply put, if the economy continues to sour, and if confidence doesn't bounce back soon, then there will be less demand for its services. No complex arguments necessary for this thesis, so far as I can tell. I would imagine that it's going to be rough for management to keep employee morale going at an acceptable level with all the cost reductions and job cuts that are being used to navigate the stormy seas. One of the worst problems I see is the minimum one-year freeze on 401(k) company matching contributions that was mentioned in the press release. Seriously, that will be a bitter pill to swallow for many.

I personally would stay away from FedEx's stock. Yes, it is well off its highs, but is all the bad news priced in the stock? My opinion: not on your life. I cannot see how anyone could read that earnings release and subsequently decide to buy shares of the company. The commentary is kind of unnerving, if you ask me. CEO Frederick W. Smith thinks the current financial climate is one of the worst seen in the company's history. Tell us something we didn't already know, buddy! What I find unnerving is that I really don't get a sense that there's any sort of plan beyond the cuts. The company is just looking to survive as best it can. I wish FedEx luck, but I don't want to get involved with the stock. At all.

Disclosure: I don't own any company mentioned; positions can change at any time.

Here in the Portland metropolitan area, 28 bike delivery employees will be hired -- by United Parcel Service (NYSE: UPS). It may seem counterintuitive, but here in Portland, Oregon, where we crazy passionate types embrace bicycling so warmly that monthly group bike rides for kids continue even through the winter, the concept of hauling up to 200 pounds in a trailer with a mountain bike sounds like the perfect holiday vacation. UPS bike drivers will be given special training to really practice pulling 200 pounds and learn, for instance, "safe following distance in rain" (I think if you're following anyone too closely with 200 pounds in your bike trailer, you should be training for the 2012 Olympics, not delivering Amazon.com packages for UPS.)

UPS can only deliver 25-50 packages per day by bicycle, compared to up to 150 by truck, but Portland area spokesman Jeff Grant says UPS will save $38,000 in vehicle operation and upkeep costs for every three delivery bicycles used.



After all, UPS started using bicycles to deliver packages 100 years ago in Seattle, and started a pilot program in Atlanta and Seattle last year. Bicycle delivery is ideal for the holiday season as it allows the company to expand its service without having to expand its fleet of expensive delivery vehicles; bikes are about $600 each, and judging by the reaction to popular biking blogs, the company will have no trouble filling the available jobs with bikers eager to prove their mettle. It's not only sensible economics, but fantastic PR for a company that struggles with a rather stodgy image. Expanding the bike delivery program for all the company's busy seasons would be a fiscally responsible plan that could also pay big dividends in customer good will.

This post is one in a series on prominent company nicknames. See all 25, and share your thoughts and memories about Big Brown below in the comments.

The simplicity of a brand name or symbol confers status on a company. Decades ago, the symbol might literally have been a stock symbol: the oldest companies got one letter ticker symbols from the New York Stock Exchange. United Parcel Service (NYSE: UPS) now gets that status by taking an entire color: brown. (Granted, it's not a primary color like IBM's Big Blue, but it still shows the company's clout.)

The company first started using its trademark brown trucks in the 1920s when it delivered appliances and other goods for department stores, says Mike Brewster, author of Driving Change: The UPS Approach to Business. Pullman brown was a good choice because "their department store clients wanted the company to be more under-stated, because the stores didn't want the fact that they no longer had their own trucks highlighted." That, and the dark trucks were easier to keep looking clean.

Brown is much more than a truck color now. It's the uniform. It's the logo. It's what the company calls itself in commercials. UPS employees bragging about their loyalty will say they "bleed brown." This year the company sponsored a horse named Big Brown, which won two-thirds of the Triple Crown.

But, hard as it is to believe now, UPS almost gave up its trademark color. "The company almost changed the color in the '90s during one of several re-brandings, but decided to stick with brown, much to the disappointment of many in the company," says Brewster. "But the 'What can Brown do for You?' campaign has given the color new life at the company."

Some may view the sun as rising while others see it setting. Before you send me your rant that the pain has just begun and I am foolish to believe the recent market upswing is anything but a short term reprieve, let me share a few thoughts.

Today Wachovia Corp (NYSE: WB) reported a loss of $1.30 a share compared to the average analysts' guess of $1.27 a share. WB lost almost $9 billion, is cutting the dividend and will layoff 6,400 employees. All bad news -- and still the the stock and the DJIA are up!

At the same time, oil is trading down about $4 a barrel during the busiest driving time of the year because people are actually conserving gas. The market is working. It should also be noted that after the Bush administration spent over seven and a half years stating various preconditions to establishing relations with Iran, last week they decided to send an envoy and start a dialog. It may be good or bad politics depending on your view -- but it is only good for the stabilization of oil prices.

United Parcel Service Inc. (NYSE: UPS) lowered its Q2 guidance just under a month ago amid worries that high increases in fuel costs would shave a bit off its earnings, which is coming up this Monday. While the company is still expected to post an EPS figure of $0.82 for its second quarter, this would be an 18% drop from the year-ago period. Its stock has recently hit a 52-week low, but then again, a recent analyst upgrade has the shares rallying a bit to offset that low.

Although fuel costs are affecting just about any company involved in transportation, the business and consumer shipping industry is still apparently going decent even in a downbeat economy. UPS said that package volume was being negatively affected by the U.S. economy, though -- and this is having an effect on international package volume as well. It's not that businesses and consumers have stopped shipping -- perhaps they are delaying shipping or forgoing it together on some items.

UPS did say that its Supply Chain and Freight segment was expected to outdo expectations for the second quarter, which will be a nice bright spot for the company. So, I have to ask: have you stopped ordering products (as a business or consumer) that require shipping? That is what UPS is implying with the statement it came out with on June 23rd when it lowered Q2 guidance. My bet -- UPS will earn $0.80 per share, even lower than its lowered guidance. What's your call?

United Parcel Service (NYSE: UPS) is recently trading at $65.12 in pre-open trading, below its close of $67.34.

Fedex (NYSE: FDX) is recently down 4.6% in pre-market trading after lowering 2009 EPS guidance.

UPS July option implied volatility of 27 is above its 26-week average of 24 according to Track Data, suggesting larger price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Shares of United Parcel Service (NYSE: UPS) fell after the world's largest shipper reduced its first quarter earnings forecast, citing a downturn in the U.S. economy and lower shipping volumes.

The warning, which came two months after the company told investors that it might miss its earnings guidance, isn't a huge shock and likely will be one of many to come during the current earnings season. After the close yesterday, UPS lowered its first quarter outlook to 86 cents to 87 cents from 94 cents to 98 cents, according to The Associated Press. Analysts were expecting earnings of 93 cents.

Pundits such as BB&T analyst John Barnes aren't finding fault with UPS.

"I don't think they misread anything. The market just got a lot weaker and oil prices shot up more aggressively than they thought,'' he told Bloomberg TV, adding that package shippers are "going to have to provide guidance with the assumption that oil prices are going to stay this high for the foreseeable future.''

Given that UPS is down about 3%, you have to wonder whether investors will be so forgiving to other companies.