We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
FedEx (FDX) Q4 Earnings Surpass Estimates, Revenues Lag
Read MoreHide Full Article
FedEx Corporation’s (FDX - Free Report) fourth-quarter fiscal 2024 earnings per share (EPS) (excluding 53 cents from non-recurring items) of $5.41 beat the Zacks Consensus Estimate of $5.34 and improved 9.5% year over year.
Revenues of $22.109 billion fell short of the Zacks Consensus Estimate of $22.115 billion but grew 0.8% from the year-ago quarter’s reported figure.
Operating income, on a reported basis, increased 3% to $1.555 billion from the year-ago quarter’s reported number. Operating margin improved to 7.0% from 6.9% in the year-ago reported quarter. The upside marked lower structural costs as the company continued to execute its DRIVE program.
Operating expenses (reported basis) increased 1% to $20.554 billion.
Segmental Performance During the Quarter
FedEx Express segment’s revenues grew 0.1% year over year to $10.417 billion. Operating income of the segment fell 53% year over year, owing to lower international yields, partially offset by reduced structural costs from DRIVE initiatives and higher U.S. domestic package yields. During the reported quarter, FedEx Express permanently retired certain aircraft and related engines as part of its fleet modernization program.
FedEx Ground segment’s revenues increased 2% year over year to $8.494 billion due to higher yield and volume growth. The actual figure was lower than our estimate of $8.807 billion. Operating income grew 10% year over year, owing to reduced structural costs resulting from DRIVE initiatives, increased yield, lower self-insurance costs, and growth in ground commercial volume.
FedEx Freight revenues grew 2% from the year-ago quarter’s reported figure to $2.306 billion. The actual figure was lower than our estimate of $2.377 billion. The segment’s operating income rose 13% year over year owing to higher yield and effective cost management. FedEx Freight has announced plans to further optimize its operations and match capacity with demand through the planned permanent closure of seven facilities.
Average daily shipments stayed almost flat year over year. Capital expenditures for fourth-quarter fiscal 2024 were $1.20 billion.
Liquidity
FedEx exited fourth-quarter fiscal 2024 with cash and cash equivalents of $6.501 billion compared with $5.644 billion at the prior-quarter end. Long-term debt (less current portion) was $20.135 billion compared with $20.122 billion at the end of the prior quarter.
During fiscal 2024, FedEx returned almost $3.8 billion to shareholders which includes $2.5 billion through share repurchases and $1.3 billion in the form of dividend payments.
Fiscal 2025 Outlook
FDX expects revenues to grow in low-to-mid single-digit percentage year over year.
EPS is expected to be in the range of $18.25-$20.25 before the MTM retirement plans accounting adjustments and $20.00 to $22.00 after excluding costs related to business optimization initiatives
FDX now anticipates capital spending of $5.2 billion in fiscal 2025. Effective tax rate is still estimated to be 24.5%.
For fiscal 2025, FedEx anticipates repurchasing $2.5 billion of common stock, including $1.0 billion during the fiscal first quarter and previously announced a 10% increase (48 cents per share) in the annual dividend rate on its common stock to $5.52 per share.
Delta Air Lines (DAL - Free Report) reported first-quarter 2024 earnings (excluding 39 cents from non-recurring items) of 45 cents per share, which comfortably beat the Zacks Consensus Estimate of 36 cents. Earnings increased 80% on a year-over-year basis.
Revenues of $13.75 billion surpassed the Zacks Consensus Estimate of $12.84 billion and increased 7.75% on a year-over-year basis, driven by strong air-travel demand. Adjusted operating revenues (excluding third-party refinery sales) came in at $12.56 billion, up 6% year over year.
United Airlines Holdings, Inc. (UAL - Free Report) reported first-quarter 2024 loss per share (excluding 23 cents from non-recurring items) of 15 cents, which was narrower than the Zacks Consensus Estimate’s loss of 53 cents. In the year-ago reported quarter, UAL reported a loss of 63 cents per share.
Operating revenues of $12,539 million beat the Zacks Consensus Estimate of $12,428.4 million. The top line increased 9.7% year over year due to upbeat air-travel demand. This was driven by a 10.1% rise in passenger revenues (accounting for 90.2% of the top line) to $11,313 million. Almost 39,325 passengers traveled on UAL flights in the first quarter, up 6.8% year over year.
J.B. Hunt Transport Services, Inc.’s (JBHT - Free Report) first-quarter 2024 earnings of $1.22 per share missed the Zacks Consensus Estimate of $1.53 and declined 35.5% year over year.
JBHT’s total operating revenues of $2,944 million missed the Zacks Consensus Estimate of $3,117.1 million and fell 8.8% year over year. Total operating revenues, excluding fuel surcharge revenue, fell 7% year over year. The downfall was owing to a 9% decrease in segment gross revenue per load in both Intermodal (JBI) and Truckload (JBT), 22% fewer loads in Integrated Capacity Solution (ICS), and a modest decline in average trucks and productivity in Dedicated Contract Services (DCS). Revenue declines in JBI, ICS, JBT and DCS were partially offset by Final Mile Services (FMS) revenue growth of 2%, primarily driven by new contracts implemented over the past year.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
FedEx (FDX) Q4 Earnings Surpass Estimates, Revenues Lag
FedEx Corporation’s (FDX - Free Report) fourth-quarter fiscal 2024 earnings per share (EPS) (excluding 53 cents from non-recurring items) of $5.41 beat the Zacks Consensus Estimate of $5.34 and improved 9.5% year over year.
Revenues of $22.109 billion fell short of the Zacks Consensus Estimate of $22.115 billion but grew 0.8% from the year-ago quarter’s reported figure.
Operating income, on a reported basis, increased 3% to $1.555 billion from the year-ago quarter’s reported number. Operating margin improved to 7.0% from 6.9% in the year-ago reported quarter. The upside marked lower structural costs as the company continued to execute its DRIVE program.
Operating expenses (reported basis) increased 1% to $20.554 billion.
Segmental Performance During the Quarter
FedEx Express segment’s revenues grew 0.1% year over year to $10.417 billion. Operating income of the segment fell 53% year over year, owing to lower international yields, partially offset by reduced structural costs from DRIVE initiatives and higher U.S. domestic package yields. During the reported quarter, FedEx Express permanently retired certain aircraft and related engines as part of its fleet modernization program.
FedEx Ground segment’s revenues increased 2% year over year to $8.494 billion due to higher yield and volume growth. The actual figure was lower than our estimate of $8.807 billion. Operating income grew 10% year over year, owing to reduced structural costs resulting from DRIVE initiatives, increased yield, lower self-insurance costs, and growth in ground commercial volume.
FedEx Freight revenues grew 2% from the year-ago quarter’s reported figure to $2.306 billion. The actual figure was lower than our estimate of $2.377 billion. The segment’s operating income rose 13% year over year owing to higher yield and effective cost management. FedEx Freight has announced plans to further optimize its operations and match capacity with demand through the planned permanent closure of seven facilities.
Average daily shipments stayed almost flat year over year. Capital expenditures for fourth-quarter fiscal 2024 were $1.20 billion.
Liquidity
FedEx exited fourth-quarter fiscal 2024 with cash and cash equivalents of $6.501 billion compared with $5.644 billion at the prior-quarter end. Long-term debt (less current portion) was $20.135 billion compared with $20.122 billion at the end of the prior quarter.
During fiscal 2024, FedEx returned almost $3.8 billion to shareholders which includes $2.5 billion through share repurchases and $1.3 billion in the form of dividend payments.
Fiscal 2025 Outlook
FDX expects revenues to grow in low-to-mid single-digit percentage year over year.
EPS is expected to be in the range of $18.25-$20.25 before the MTM retirement plans accounting adjustments and $20.00 to $22.00 after excluding costs related to business optimization initiatives
FDX now anticipates capital spending of $5.2 billion in fiscal 2025. Effective tax rate is still estimated to be 24.5%.
For fiscal 2025, FedEx anticipates repurchasing $2.5 billion of common stock, including $1.0 billion during the fiscal first quarter and previously announced a 10% increase (48 cents per share) in the annual dividend rate on its common stock to $5.52 per share.
FedEx currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performances of Other Transportation Companies
Delta Air Lines (DAL - Free Report) reported first-quarter 2024 earnings (excluding 39 cents from non-recurring items) of 45 cents per share, which comfortably beat the Zacks Consensus Estimate of 36 cents. Earnings increased 80% on a year-over-year basis.
Revenues of $13.75 billion surpassed the Zacks Consensus Estimate of $12.84 billion and increased 7.75% on a year-over-year basis, driven by strong air-travel demand. Adjusted operating revenues (excluding third-party refinery sales) came in at $12.56 billion, up 6% year over year.
United Airlines Holdings, Inc. (UAL - Free Report) reported first-quarter 2024 loss per share (excluding 23 cents from non-recurring items) of 15 cents, which was narrower than the Zacks Consensus Estimate’s loss of 53 cents. In the year-ago reported quarter, UAL reported a loss of 63 cents per share.
Operating revenues of $12,539 million beat the Zacks Consensus Estimate of $12,428.4 million. The top line increased 9.7% year over year due to upbeat air-travel demand. This was driven by a 10.1% rise in passenger revenues (accounting for 90.2% of the top line) to $11,313 million. Almost 39,325 passengers traveled on UAL flights in the first quarter, up 6.8% year over year.
J.B. Hunt Transport Services, Inc.’s (JBHT - Free Report) first-quarter 2024 earnings of $1.22 per share missed the Zacks Consensus Estimate of $1.53 and declined 35.5% year over year.
JBHT’s total operating revenues of $2,944 million missed the Zacks Consensus Estimate of $3,117.1 million and fell 8.8% year over year. Total operating revenues, excluding fuel surcharge revenue, fell 7% year over year. The downfall was owing to a 9% decrease in segment gross revenue per load in both Intermodal (JBI) and Truckload (JBT), 22% fewer loads in Integrated Capacity Solution (ICS), and a modest decline in average trucks and productivity in Dedicated Contract Services (DCS). Revenue declines in JBI, ICS, JBT and DCS were partially offset by Final Mile Services (FMS) revenue growth of 2%, primarily driven by new contracts implemented over the past year.