CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
Our 12-month target price of $263, cut by $6, reflects a 12x multiple of our revised FY 25 (May) EPS estimate, about in line with FDX’s historical forward average. We cut our FY 24 (May) EPS estimate by $0.69 to $17.69 and FY 25’s by $0.50 to $21.92. FQ2 operating EPS of $3.99 vs. $3.18, missed the consensus view by $0.21. Volumes were light, a continuation of demand headwinds seen in FQ1, but worse than FDX had expected. Updated FDX guidance for FY 24 indicates a revenue outlook that is slightly worse than before. Notably, FDX sees revenues down low-single digits in FY 24 rather than flat, and may reflect some higher competitive pressure from the U.S. Postal Service, as it shifts toward ground shipments rather than air shipments. We think FDX is making nice progress on the cost front, but the stock reaction today (-11%) indicates, in our view, that successful completion of cost improvement efforts – which looks promising – is being undermined on the revenue side to a degree.