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FedEx (FDX) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, FedEx (FDX) closed at $155.98, marking a +0.87% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.29%. Elsewhere, the Dow gained 0.17%, while the tech-heavy Nasdaq added 0.19%.

Coming into today, shares of the package delivery company had gained 7.94% in the past month. In that same time, the Transportation sector gained 1.58%, while the S&P 500 gained 0.32%.

Investors will be hoping for strength from FDX as it approaches its next earnings release, which is expected to be December 17, 2019. In that report, analysts expect FDX to post earnings of $2.86 per share. This would mark a year-over-year decline of 29.03%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $17.58 billion, down 1.38% from the year-ago period.

FDX's full-year Zacks Consensus Estimates are calling for earnings of $12.11 per share and revenue of $69.72 billion. These results would represent year-over-year changes of -21.97% and +0.04%, respectively.

Investors might also notice recent changes to analyst estimates for FDX. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.06% lower within the past month. FDX is currently sporting a Zacks Rank of #4 (Sell).

In terms of valuation, FDX is currently trading at a Forward P/E ratio of 12.77. This represents a premium compared to its industry's average Forward P/E of 11.93.

It is also worth noting that FDX currently has a PEG ratio of 1.06. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. FDX's industry had an average PEG ratio of 1.42 as of yesterday's close.

The Transportation - Air Freight and Cargo industry is part of the Transportation sector. This industry currently has a Zacks Industry Rank of 99, which puts it in the top 39% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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