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) Beats on Q3 Earnings, Raises Fiscal 2018 Outlook
Read MoreHide Full Article
FedEx Corporation (FDX - Free Report) reported better-than-expected results in the third quarter of fiscal 2018 (ended Feb 28, 2018), driven by higher base rates, increased volumes at the Ground and Freight segments and a favorable impact from fuel.
The company’s earnings (excluding $3.87 from non-recurring items) of $3.72 per share comfortably surpassed the Zacks Consensus Estimate of $3.08. Furthermore, the bottom line soared 58.3% on a year-over-year basis. Results were aided by higher revenues.
Quarterly revenues increased 10.2% year over year to $16,526 million, beating the Zacks Consensus Estimate of $16,179.7 million. Growth was witnessed across all major divisions of the company.
Operating income (on an adjusted basis) inched up 0.9% year over year to $1.11 billion in the reported quarter. However, operating margin contracted to 6.7% from 7.4% in third-quarter fiscal 2017.
FedEx Corporation Price, Consensus and EPS Surprise
Quarterly revenues at FedEx Express (including TNT Express) improved 9.3% to $9.37 billion, on the back of hiked base rates, higher fuel surcharges as well as favorable exchange rates.
Operating income (adjusted, excluding TNT Express integration expenses) came in at $510 million, down 16.4% year over year while operating margin decreased to 5.4% year over year from 7.1% in the year-ago quarter. Total package volume slipped 1% while average daily freight pounds rose 3%.
FedEx Ground revenues grew 11% year over year to $5.22 billion in the period under review. Volume expansion and higher base rates aided the segmental performance. Average daily volume climbed 6% whereas operating income came in at $634 million, up 23%. Operating margin expanded 110 basis points (bps) to 12.1%.
FedEx Freight revenues jumped 14% year over year to $1.69 billion. Segmental revenues were benefited by less-than-truckload (LTL) revenues per shipment growth of 8% average daily LTL shipment growth of 6%. Also, the segment’s operating income surged 34% to $55 million. Plus, the operating margin expanded 50 bps to 3.2%.
Q4 Fiscal 2018 Outlook
FedEx has issued guidance for operating income and margin for the fiscal fourth quarter. Additionally, it has provided an outlook for segmental operating margin. Each forecast assumes moderate economic growth.
The company estimates fourth-quarter consolidated operating income excluding TNT Express integration expenses and certain other items, in the range of $1.95-$2.05 billion. While operating margin excluding TNT Express integration expenses and certain other items, is projected at 11-11.8%.
For fourth-quarter fiscal 2018, the company forecasts adjusted operating margin (minus TNT Express integration expenses) at the FedEx Express segment between 9.9% and 10.4%. While at FedEx Ground and Freight segments, the metric (on a reported basis) is estimated between 17-17.5% and 8-9%, respectively.
The segmental margin predictions indicate the recent realignment of the company’s specialty logistics and e-commerce solutions with a new organizational structure within the FedEx Express segment.
Bullish Fiscal 2018 Projection
The company has raised its view for fiscal 2018 owing to foreign tax benefits from international corporate structure, better operating performance and gains from the tax reform. The company has also reiterated its commitment to increase operating income by $1.2-$1.5 billion in fiscal 2020 compared with the tally registered in fiscal 2017.
For fiscal 2018, the company anticipates earnings per share (excluding TNT Express integration expenses and certain other items) in the range of $15-$15.40, higher than the previous projection of $12.70-$13.30. The Zacks Consensus Estimate for fiscal 2018 earnings is pegged at $13.51.
Moreover, capital expenses are expected at $5.8 billion, down $100 million from the earlier guidance.
Zacks Rank & Other Key Picks
FedEx carries a Zacks Rank #2 (Buy). Other top-ranked stocks in the broader Transportation sector include International Consolidated Airlines Group SA (ICAGY - Free Report) , American Airlines Group Inc. (AAL - Free Report) and Atlas Air Worldwide Holdings . While International Consolidated Airlines sports a Zacks Rank #1 (Strong Buy), American Airlines and Atlas Air Worldwide carry a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of International Consolidated Airlines, American Airlines and Atlas Air Worldwide have rallied more than 29%, 37% and 24%, respectively, in a year.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
FedEx (FDX) Beats on Q3 Earnings, Raises Fiscal 2018 Outlook
FedEx Corporation (FDX - Free Report) reported better-than-expected results in the third quarter of fiscal 2018 (ended Feb 28, 2018), driven by higher base rates, increased volumes at the Ground and Freight segments and a favorable impact from fuel.
The company’s earnings (excluding $3.87 from non-recurring items) of $3.72 per share comfortably surpassed the Zacks Consensus Estimate of $3.08. Furthermore, the bottom line soared 58.3% on a year-over-year basis. Results were aided by higher revenues.
Quarterly revenues increased 10.2% year over year to $16,526 million, beating the Zacks Consensus Estimate of $16,179.7 million. Growth was witnessed across all major divisions of the company.
Operating income (on an adjusted basis) inched up 0.9% year over year to $1.11 billion in the reported quarter. However, operating margin contracted to 6.7% from 7.4% in third-quarter fiscal 2017.
FedEx Corporation Price, Consensus and EPS Surprise
FedEx Corporation Price, Consensus and EPS Surprise | FedEx Corporation Quote
Segmental Performance
Quarterly revenues at FedEx Express (including TNT Express) improved 9.3% to $9.37 billion, on the back of hiked base rates, higher fuel surcharges as well as favorable exchange rates.
Operating income (adjusted, excluding TNT Express integration expenses) came in at $510 million, down 16.4% year over year while operating margin decreased to 5.4% year over year from 7.1% in the year-ago quarter. Total package volume slipped 1% while average daily freight pounds rose 3%.
FedEx Ground revenues grew 11% year over year to $5.22 billion in the period under review. Volume expansion and higher base rates aided the segmental performance. Average daily volume climbed 6% whereas operating income came in at $634 million, up 23%. Operating margin expanded 110 basis points (bps) to 12.1%.
FedEx Freight revenues jumped 14% year over year to $1.69 billion. Segmental revenues were benefited by less-than-truckload (LTL) revenues per shipment growth of 8% average daily LTL shipment growth of 6%. Also, the segment’s operating income surged 34% to $55 million. Plus, the operating margin expanded 50 bps to 3.2%.
Q4 Fiscal 2018 Outlook
FedEx has issued guidance for operating income and margin for the fiscal fourth quarter. Additionally, it has provided an outlook for segmental operating margin. Each forecast assumes moderate economic growth.
The company estimates fourth-quarter consolidated operating income excluding TNT Express integration expenses and certain other items, in the range of $1.95-$2.05 billion. While operating margin excluding TNT Express integration expenses and certain other items, is projected at 11-11.8%.
For fourth-quarter fiscal 2018, the company forecasts adjusted operating margin (minus TNT Express integration expenses) at the FedEx Express segment between 9.9% and 10.4%. While at FedEx Ground and Freight segments, the metric (on a reported basis) is estimated between 17-17.5% and 8-9%, respectively.
The segmental margin predictions indicate the recent realignment of the company’s specialty logistics and e-commerce solutions with a new organizational structure within the FedEx Express segment.
Bullish Fiscal 2018 Projection
The company has raised its view for fiscal 2018 owing to foreign tax benefits from international corporate structure, better operating performance and gains from the tax reform. The company has also reiterated its commitment to increase operating income by $1.2-$1.5 billion in fiscal 2020 compared with the tally registered in fiscal 2017.
For fiscal 2018, the company anticipates earnings per share (excluding TNT Express integration expenses and certain other items) in the range of $15-$15.40, higher than the previous projection of $12.70-$13.30. The Zacks Consensus Estimate for fiscal 2018 earnings is pegged at $13.51.
Moreover, capital expenses are expected at $5.8 billion, down $100 million from the earlier guidance.
Zacks Rank & Other Key Picks
FedEx carries a Zacks Rank #2 (Buy). Other top-ranked stocks in the broader Transportation sector include International Consolidated Airlines Group SA (ICAGY - Free Report) , American Airlines Group Inc. (AAL - Free Report) and Atlas Air Worldwide Holdings . While International Consolidated Airlines sports a Zacks Rank #1 (Strong Buy), American Airlines and Atlas Air Worldwide carry a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of International Consolidated Airlines, American Airlines and Atlas Air Worldwide have rallied more than 29%, 37% and 24%, respectively, in a year.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>