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FedEx (FDX) Registers a Bigger Fall Than the Market: Important Facts to Note

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The latest trading session saw FedEx (FDX - Free Report) ending at $213.41, denoting a -1.65% adjustment from its last day's close. This change lagged the S&P 500's 0.77% loss on the day. Elsewhere, the Dow saw a downswing of 0.95%, while the tech-heavy Nasdaq depreciated by 0.87%.

The package delivery company's stock has climbed by 5.73% in the past month, falling short of the Transportation sector's gain of 7.05% and the S&P 500's gain of 11.54%.

Market participants will be closely following the financial results of FedEx in its upcoming release. The company is expected to report EPS of $6.03, up 11.46% from the prior-year quarter. In the meantime, our current consensus estimate forecasts the revenue to be $21.8 billion, indicating a 1.41% decline compared to the corresponding quarter of the prior year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $18.21 per share and revenue of $87.46 billion. These totals would mark changes of +2.3% and -0.23%, respectively, from last year.

Investors should also pay attention to any latest changes in analyst estimates for FedEx. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.02% lower within the past month. FedEx is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, FedEx is currently trading at a Forward P/E ratio of 11.92. This valuation marks a discount compared to its industry's average Forward P/E of 13.06.

It's also important to note that FDX currently trades at a PEG ratio of 1.11. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. 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 192, putting it in the bottom 23% 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.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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