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FedEx (FDX) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

FedEx (FDX) closed at $158.07 in the latest trading session, marking a -1.24% move from the prior day. This change lagged the S&P 500's daily loss of 0.86%. Elsewhere, the Dow lost 0.96%, while the tech-heavy Nasdaq lost 1.13%.

Coming into today, shares of the package delivery company had gained 4.84% in the past month. In that same time, the Transportation sector gained 2.06%, while the S&P 500 gained 3.66%.

Wall Street will be looking for positivity from FDX as it approaches its next earnings report date. This is expected to be December 17, 2019. On that day, FDX is projected to report earnings of $2.86 per share, which would represent a year-over-year decline of 29.03%. Our most recent consensus estimate is calling for quarterly revenue of $17.58 billion, down 1.38% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $12.11 per share and revenue of $69.72 billion. These totals would mark changes of -21.97% and +0.04%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for FDX. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. FDX is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that FDX has a Forward P/E ratio of 13.22 right now. For comparison, its industry has an average Forward P/E of 13.22, which means FDX is trading at a no noticeable deviation to the group.

Also, we should mention that FDX has a PEG ratio of 1.1. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. FDX's industry had an average PEG ratio of 1.46 as of yesterday's close.

The Transportation - Air Freight and Cargo industry is part of the Transportation sector. This group has a Zacks Industry Rank of 165, putting it in the bottom 36% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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