FedEx is Having a Bad (5) Year(s)

FedEx FDX 154.63 +2.59 +1.70% plunges… plunges? I’d guess a 12%+ drop is a plunge, definitely don’t want to see it in my portfolio.

They reported earnings of $3.05 per share on revenue of $17.0 billion. The consensus earnings estimate was $3.17 per share on revenue of $17.1 billion. Revenue was flatish.

The company said it expects fiscal 2020 earnings of $11.00 to $13.00 per share. The current consensus earnings estimate is $14.67 per share for the year ending May 31, 2020.

There’s the rub, little bit of earnings miss is a maybe 4-6% drop for a blue chip. The breakup with Amazon and “increased trade tensions and additional weakening of global economic conditions ” has hit FedEx pretty hard. If they come in on the low end we’re looking at a 25% drop in earnings for fiscal 2020.

UPS UPS 118.42 +0.91 +0.77% doesn’t report till October 23rd, but their last report (in June) was pretty upbeat and the low guidance number was at expectations. “The company said it continues to expect 2019 earnings of $7.45 to $7.75 per share. The current consensus earnings estimate is $7.46 per share for the year ending December 31, 2019.”

So we’ll have to wait and see if this is systemic or confined to just FedEx.

We’re back to where we were three years ago, and below the five year point.