Two Ways: FedEx Delivers Poor Results
Strengthen your portfolio in good times and bad.
FedEx (FDX) reported third-quarter earnings far below Wall Street expectations today. Net income plunged 75% to $97 million, or $0.31 a share, down from $393 million, or $1.26 a share, from a year earlier. According to the Wall Street Journal, revenues declined to $8.14 billion owing to lower fuel surcharges and shipment weights.
FedEx plans to cut about $1 billion in expenses in the coming fiscal year. It projects fourth-quarter earnings between $0.45 and $0.70 a share, below consensus estimates of $0.72 a share.
Despite the negative headlines, shares of the shipping giant closed higher by 4.8% to $45.10.
See Professor Kevin Depew's Five Things: Fed Fires Final Bullet; Market Shrugs for more on the economy.
From the Bull Pen: FedEx is a member of the Dow Transports, which Professor Sadana suggests keeping an eye on. Reaction to the news is positive so far, which is good because the S&P 500 likely won't rally without Fedex and the rest of this index. Bulls can use the S&P Depository receipts (SPY); a pullback to near 75 shouldn't be ruled out.
From the Bear Cave: Bears can keep an eye on General Electric (GE). Those considering the downside can use puts (defined risk) as Professor Bill Feingold mentioned on the Buzz earlier this week.
What a long week, but we still have one more day left. Have a great night and we'll see you in the morning!
Actionable ideas, instant analysis. Real-time from bell to bell.
Minyanville's Buzz & Banter - 14 day FREE trial
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter