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Photograph of Justin Sullivan / Getty Images
Giant of express shipping
FedEx
Wall Street's missed expectations for the first quarter of its fiscal year ended in August and the company has trimmed its forecast for next year's earnings. Thanks to this double dose of bad news, FedEx shares have lost more than 9% of transactions after hours.
This movement essentially cancels out all cumulative gains since the beginning of the year, leaving FedEx far behind the 18% gain
Dow Jones Industrial Average.
Over the past year, FedEx shares (ticker: FDX) have fallen nearly 40%, including the decline after Tuesday. In comparison, the Dow Jones index has grown about 7% over the last 12 months.
During the quarter, FedEx achieved a turnover of $ 17 billion, one penny less than the predictions of Wall Street.
"Our performance continues to be affected by a weakened global macroeconomic environment, fueled by growing trade tensions and political uncertainty," said Frederick Smith, FedEx CEO, in the company's press release. "Despite these challenges, we are preparing FedEx to take advantage of future growth opportunities while continuing to integrate TNT Express, improving FedEx Ground's residential delivery capabilities, and modernizing the operations of the airline fleet and hub. FedEx Express. "
FedEx now expects to earn about $ 12 per share during fiscal year 2020, before retirement and restructuring expenses. Wall Street was expecting about $ 15 per share, according to FactSet.
Barron recently wrote positively on FedEx shares, saying that fears of competition
Amazon.com
(AMZN) are exaggerated. This quarter does not feel like talking about Amazon, even if FedEx has abandoned its activities. Instead, it is more about the economy.
Although the earnings report does not contain very good news for investors, the company has announced price increases of 4.9% for 2020 and capital expenditures for fiscal year 2020 are expected to be 5, $ 9 billion, less than predicted by Wall Street. The reduction in capital expenditures increases cash flow – this is a small benefit for FedEx shares.
The management will welcome at 17:30 on call. AND to examine the results.
Write to Al Root at [email protected]
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