We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
FedEx (FDX) Q4 Earnings Surpass Estimates, Revenues Miss
Read MoreHide Full Article
FedEx Corporation's (FDX - Free Report) fourth-quarter fiscal 2023 earnings (excluding $1.11 from non-recurring items) of $4.94 per share beat the Zacks Consensus Estimate of $4.83. However, the bottom line declined 28.1% year over year.
Revenues of $21,930 million fell short of the Zacks Consensus Estimate of $22,723 million and decreased 10.1% from the year-ago fiscal quarter’s reported figure.
Quarterly results were affected by persistent demand weakness and cost inflation, partially offset by cost-reduction efforts and U.S. domestic package yield improvement.
Operating expenses (reported basis) decreased 9.1% to $20.4 billion owing to the company’s cost-reduction actions. Operating income, on a reported basis, decreased 21.9% from the year-ago fiscal quarter’s reported number to $1.50 billion due to weak shipping demand.
Segmental Performance
FedEx Express segment’s revenues fell 12.8% year over year to $10,407 million, owing to a decline in global volumes. Operating income of the segment fell 51.5% year over year due to lower global volumes, partially offset by decreased expenses and higher U.S. domestic yields.
FedEx Ground segment’s revenues decreased 2.2% year over year to $8,296 million. Operating income increased 18.3% year over year, owing to higher revenue per package and cost-reduction actions. These were partially offset by lower package volume, higher infrastructure costs and increased other operating expenses.
FedEx Freight revenues declined 17.7% from the year-ago quarter’s reported figure to $2,269 million. The segment’s operating income declined 25.5% year over year owingto decreased shipments and lower weight per shipment, partially offset by improved revenue quality.
Average daily shipments declined 17.6% and revenue per shipment decreased 0.1%. Capital expenditures for 2023 came in at $6174 million.
Liquidity
FedEx exited fourth-quarter fiscal 2023 with cash and cash equivalents of $10,188 million compared with $5,373 million at the end of the prior quarter. Long-term debt (less current portion) was $20,453 million compared with $20,122 million at the end of the prior quarter.
Fiscal 2024 Outlook
For 2024, FedEx expects revenues to be flat to up in low single digits year over year. Earnings per share are expected to be in the range of $15.00 to $17.00 (prior to MTM retirement plans accounting adjustments) and $16.50 to $18.50 (excluding costs related to business optimization initiatives).
FDX anticipates capital spending of $5.7 billion in fiscal 2024. The effective tax rate is estimated to be 25%.
For 2024, FedEx anticipates repurchasing shares worth $2 billion. It intends to pay an annual dividend of $5.04 per share, based on the previously announced 10% dividend hike (44 cents per share).
Copa Holdings has an expected earnings growth rate of 75.42% for the current year. CPA delivered a trailing four-quarter earnings surprise of 14.60%, on average.
The Zacks Consensus Estimate for CPA’s current-year earnings has improved 25.5% over the past 90 days. Shares of CPA have soared 32.5% over the past six months.
Allegiant has an expected earnings growth rate of more than 100% for the current year. ALGT delivered a trailing four-quarter earnings surprise of 79.78%, on average.
The Zacks Consensus Estimate for ALGT’s current-year earnings has improved 46.5% over the past 90 days. Shares of ALGT have soared 77.9% over the past six months.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
FedEx (FDX) Q4 Earnings Surpass Estimates, Revenues Miss
FedEx Corporation's (FDX - Free Report) fourth-quarter fiscal 2023 earnings (excluding $1.11 from non-recurring items) of $4.94 per share beat the Zacks Consensus Estimate of $4.83. However, the bottom line declined 28.1% year over year.
Revenues of $21,930 million fell short of the Zacks Consensus Estimate of $22,723 million and decreased 10.1% from the year-ago fiscal quarter’s reported figure.
Quarterly results were affected by persistent demand weakness and cost inflation, partially offset by cost-reduction efforts and U.S. domestic package yield improvement.
Operating expenses (reported basis) decreased 9.1% to $20.4 billion owing to the company’s cost-reduction actions. Operating income, on a reported basis, decreased 21.9% from the year-ago fiscal quarter’s reported number to $1.50 billion due to weak shipping demand.
Segmental Performance
FedEx Express segment’s revenues fell 12.8% year over year to $10,407 million, owing to a decline in global volumes. Operating income of the segment fell 51.5% year over year due to lower global volumes, partially offset by decreased expenses and higher U.S. domestic yields.
FedEx Ground segment’s revenues decreased 2.2% year over year to $8,296 million. Operating income increased 18.3% year over year, owing to higher revenue per package and cost-reduction actions. These were partially offset by lower package volume, higher infrastructure costs and increased other operating expenses.
FedEx Freight revenues declined 17.7% from the year-ago quarter’s reported figure to $2,269 million. The segment’s operating income declined 25.5% year over year owingto decreased shipments and lower weight per shipment, partially offset by improved revenue quality.
Average daily shipments declined 17.6% and revenue per shipment decreased 0.1%. Capital expenditures for 2023 came in at $6174 million.
Liquidity
FedEx exited fourth-quarter fiscal 2023 with cash and cash equivalents of $10,188 million compared with $5,373 million at the end of the prior quarter. Long-term debt (less current portion) was $20,453 million compared with $20,122 million at the end of the prior quarter.
Fiscal 2024 Outlook
For 2024, FedEx expects revenues to be flat to up in low single digits year over year. Earnings per share are expected to be in the range of $15.00 to $17.00 (prior to MTM retirement plans accounting adjustments) and $16.50 to $18.50 (excluding costs related to business optimization initiatives).
FDX anticipates capital spending of $5.7 billion in fiscal 2024. The effective tax rate is estimated to be 25%.
For 2024, FedEx anticipates repurchasing shares worth $2 billion. It intends to pay an annual dividend of $5.04 per share, based on the previously announced 10% dividend hike (44 cents per share).
Zacks Rank & Stocks to Consider
FedEx currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks for investors interested in the Zacks Transportation sector are Copa Holdings (CPA - Free Report) and Allegiant Travel Company (ALGT - Free Report) . Each of these companies presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Copa Holdings has an expected earnings growth rate of 75.42% for the current year. CPA delivered a trailing four-quarter earnings surprise of 14.60%, on average.
The Zacks Consensus Estimate for CPA’s current-year earnings has improved 25.5% over the past 90 days. Shares of CPA have soared 32.5% over the past six months.
Allegiant has an expected earnings growth rate of more than 100% for the current year. ALGT delivered a trailing four-quarter earnings surprise of 79.78%, on average.
The Zacks Consensus Estimate for ALGT’s current-year earnings has improved 46.5% over the past 90 days. Shares of ALGT have soared 77.9% over the past six months.