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Why FedEx (FDX) Outpaced the Stock Market Today

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In the latest trading session, FedEx (FDX - Free Report) closed at $257.42, marking a +1.27% move from the previous day. The stock outperformed the S&P 500, which registered a daily gain of 0.16%. On the other hand, the Dow registered a gain of 0.47%, and the technology-centric Nasdaq increased by 0.07%.

Prior to today's trading, shares of the package delivery company had gained 2.48% over the past month. This has outpaced the Transportation sector's gain of 1.55% and lagged the S&P 500's gain of 4.02% in that time.

The investment community will be paying close attention to the earnings performance of FedEx in its upcoming release. The company is slated to reveal its earnings on December 19, 2023. The company is forecasted to report an EPS of $4.07, showcasing a 27.99% upward movement from the corresponding quarter of the prior year. In the meantime, our current consensus estimate forecasts the revenue to be $22.36 billion, indicating a 2% decline compared to the corresponding quarter of the prior year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $18.14 per share and a revenue of $89.76 billion, signifying shifts of +21.26% and -0.39%, respectively, from the last year.

Investors should also note any recent changes to analyst estimates for FedEx. 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.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. FedEx presently features a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that FedEx has a Forward P/E ratio of 14.01 right now. This valuation marks a discount compared to its industry's average Forward P/E of 15.13.

Meanwhile, FDX's PEG ratio is currently 1.17. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Transportation - Air Freight and Cargo industry currently had an average PEG ratio of 1.62 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 48, putting it in the top 20% of all 250+ industries.

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

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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