Back to top

Image: Bigstock

FedEx (FDX) Gains But Lags Market: What You Should Know

Read MoreHide Full Article

FedEx (FDX) closed the most recent trading day at $156.78, moving +0.72% from the previous trading session. This change lagged the S&P 500's 0.73% gain on the day. Meanwhile, the Dow gained 0.6%, and the Nasdaq, a tech-heavy index, added 1.13%.

Heading into today, shares of the package delivery company had lost 1.51% over the past month, lagging the Transportation sector's loss of 0.64% and the S&P 500's gain of 2.95% in that time.

Wall Street will be looking for positivity from FDX as it approaches its next earnings report date. This is expected to be March 17, 2020. The company is expected to report EPS of $1.82, down 39.93% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $17.19 billion, up 1.04% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $10.84 per share and revenue of $69.23 billion. These totals would mark changes of -30.15% and -0.66%, 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.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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, 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. FDX is currently sporting a Zacks Rank of #5 (Strong Sell).

Investors should also note FDX's current valuation metrics, including its Forward P/E ratio of 14.36. Its industry sports an average Forward P/E of 13.36, so we one might conclude that FDX is trading at a premium comparatively.

Investors should also note that FDX has a PEG ratio of 1.2 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. FDX's industry had an average PEG ratio of 1.36 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 106, which puts it in the top 42% 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.

Published in