FedEx missed quarterly estimates and lowered its full-year guidance. Demand was weaker than expected for business-to-business shipping, which is its most profitable segment.
FedEx Corporation NYSE: FDX is a solid business, but its latest results give another reason to fear that a recession is near. The company underperformed in all metrics, contracting versus an expectation to grow and reducing guidance in what may be the first of several reductions this year.
FedEx's Q1 2025 results show revenue down YoY, earnings drop, and a muted FY 2025 outlook, supporting my Hold rating with short-term gain potential. Headwinds include inflation, high interest rates, USPS contract expiration reducing flight hours, and $4 billion in expenditure cuts needed, impacting volumes and earnings. Despite a healthy balance sheet and recent short-term market outperformance, a long-term investment in FDX remains unattractive due to multiple headwinds and historical underperformance.
Fed's Aggressive Half-Point Cut Signals Caution Amid Economic Uncertainty
U.S. stock futures were lower this morning, with the Nasdaq futures falling over 80 points on Friday.
Wall Street weighs in on FedEx after the shipping company reports weaker-than-expected quarterly earnings.
FedEx stock (NYSE: FDX) saw a 13% fall in after-market hours on Thursday, September 19, after it reported Q1'25 results (fiscal ends in May) far worse than the street estimates. FDX stock is up 7% year-to-date, compared to -15% returns for its peer – UPS stock.
Analysts sees a potential spinoff of FedEx's freight business as a potential boost, but the stock is dropping sharply
Just days after American TV personality Jim Cramer praised FedEx Corporation (NYSE: FDX) as a “great stock to own,” the company's shares took a nosedive, giving, once again, fuel to his critics who believe CNBC's ‘Mad Money' host is perpetually in the wrong.
David Vernon, Senior Research Analyst – Transportation at Bernstein, sees FedEx's lowered guidance as an overreaction and expects improvements later. He recommends buying the dip, noting both FedEx and UPS are well-positioned despite challenges.
FedEx tumbled in overnight US trading as it warned full earnings would miss its guidance after a difficult first quarter. One analyst said the magnitude of the miss was huge while Barclays added it was one of the “worst first quarter profitability outcomes outside of the 2009 recession.
FedEx Corporation (NYSE:FDX ) Q1 2025 Earnings Conference Call September 19, 2024 5:30 PM ET Company Participants Jeni Hollander - VP of IR Raj Subramaniam - President and CEO Brie Carere - EVP and Chief Customer Officer John Dietrich - EVP and CFO Conference Call Participants Brian Ossenbeck - JPMorgan Jordan Alliger - Goldman Sachs Jonathan Chappell - Evercore Tom Wadewitz - UBS Daniel Imbro - Stephens Chris Wetherbee - Wells Fargo Stephanie Moore - Jefferies Brandon Oglenski - Barclays Jason Seidl - TD Cowen Scott Group - Wolfe Research David Vernon - Bernstein Bruce Chan - Stifel Ken Hoexter - Bank of America Operator Good day, and welcome to the FedEx Fiscal Year 2025 First Quarter Earnings Call. [Operator Instructions] Please note, this event is being recorded.