What to Expect When FedEx Reports After the Close

FedEx Corp. (NYSE: FDX) is scheduled to release its fiscal third-quarter financial results after the markets close on Tuesday. The analysts’ consensus forecast is $1.43 in earnings per share (EPS) and $16.9 billion in revenue. In the same period of last year, the delivery services giant said it had $3.03 in EPS and $17.0 billion in revenue.

Back in the fiscal second quarter, FedEx saw declining operating results as the result of weak global economic conditions. At that time, the firm also saw increased FedEx Ground costs from expanded service offerings and the loss of business from Amazon.

Despite the weakness in that quarter, FedEx had a strong outlook going forward. With more and more people practicing social distancing and even quarantining, the shipping industry could clean up here. Amazon definitely will be a big winner from people staying in, but the sheer amount of goods needing to be shipped will overflow into FedEx and other shippers.

In its most recent earnings report, FedEx lowered its fiscal 2020 earnings forecast as the company’s revenue outlook was reduced yet again due to increased trade tensions and additional weakening of global economic conditions since the company’s initial fiscal 2020 forecast in June.

As a result, FedEx updated guidance for the fiscal 2020 full year. The company expected to see EPS in the range of $10.25 to $11.50. The consensus estimates currently are $10.41 in EPS and $68.74 billion in revenue for the fiscal year.

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Excluding Tuesday’s move, FedEx stock had underperformed the broad markets with a retreat of about 40% year to date. In the past 52 weeks, the share price was down closer to 49%.

Here’s what a few analysts had to say ahead of the report:

• UBS Group has a Buy rating with a $141 price target.
• Wells Fargo has an Overweight rating and a $150 price target.
• Stephens rates it as Overweight with a $145 price target.
• JPMorgan has a Neutral rating with a $115 target price.
• Cowen has an Outperform rating with a $160 price target.
• Stifel’s Hold rating comes with a $136 price target.

Shares of FedEx traded down less than 1% at $89.96 on Tuesday, in a 52-week range of $90.49 to $199.32. The consensus price target is $168.60.

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