(FDX) (FDX$) FedEx Reports Strong Numbers – ValuEngine Retains Buy Rating

FedEx Corporation (FDX) is a global transportation and logistics enterprise that offers customers a one-stop source for global shipping, logistics and supply chain solutions. Services offered by FedEx companies include worldwide express delivery, ground small-parcel delivery, less-than-truckload freight delivery and global logistics, supply chain management and electronic commerce solutions.

FedEx reported a 33% jump in profits today to $558 million, or $1.75 a share, up from $419 million/ $1.33 a share last year. Revenue increased 12% to $10.55 billion and beat the consensus estimates of $10.41 billion. Perhaps more important, the company stated that while current conditions remain soft, it expects economic growth to accelerate over the longer term. Key for the company’s prospects is the price of oil. Fuel costs are a major factor for the bottom line of this air cargo handler. CFO Alan Graf Jr. noted that estimates for the company are based on oil remaining around $95/barrel level and not much higher.

ValuEngine has issued a BUY recommendation for FedEx Corporation on Jun. 22, 2011. Based on the information we have gathered and our resulting research, we feel that FedEx Corporation has the probability to OUTPERFORM average market performance for the next year. The company exhibits ATTRACTIVE company size, volatility and market valuation.

Based on available data as of Jun. 22, 2011, we believe that FDX should be trading at $106.99. This makes FDX 16.69% undervalued. Fair Value indicates what we believe the stock should be trading at today if the stock market were perfectly efficient and everything traded at its true worth. For FDX, we base this on actual earnings per share (EPS) for the previous four quarters of $4.90, forecasted EPS for the next four quarters of $6.50, and correlations to the 30- year Treasury bond yield of 4.22%.

About valuengine

ValuEngine.com (VE) is a stock valuation and forecasting service founded by Ivy League finance academics. VE utilizes the most advanced quantitative techniques and analysis available. Our research team continues to develop, test, and improve the VE Stock Valuation Models and econometric models for forecasting stock price movement. In recent years, VE has expanded its research program to include portfolio construction and tracking products. Our primary products are this website for individual investors and ValuEngine Institutional (VEI), a software package for equity fund managers and other financial professionals. Until recently, access to the VE Institutional stock valuation, risk management, and forecasting technology was only available to financial professionals in the United States. Now, the individual investor planning for their own financial future and managing their own portfolio can utilize the same types of tools that are used by financial professionals managing billions of dollars in assets every business day.


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