UPDATE: JP Morgan Lowers PT on FedEx on Lower Fuel Prices

In a report published on Friday, JP Morgan analyst Thomas Wadewitz lowered the price target on FedEx

from $122.00 to $116.00 and reiterated an Overweight rating. The report noted, "We anticipate a 4QF13 EPS report from FDX that may be modestly above expectations due to a tailwind from lower fuel prices. However, we expect the 4Q to also reflect continued pressures from trade down and generally soft international airfreight demand. Looking to F2014 we believe that on-going pressure from trade down and the impact from lower pricing on FDX's renewed USPS contract are likely to drive EPS below current Consensus of $7.47/share. We have lowered our EPS estimate to $7.00/share which still reflects 15% EPS growth. In our view, a more favorable cyclical backdrop (stronger growth and a more balanced international airfreight market and solid domestic small package demand) would support an attractive margin improvement and EPS growth story for FDX. However, if the environment remains one of only very slow economic growth, current challenges may persist and offset a meaningful portion of the favorable impact from FDX's operating improvement program. Patience may be required but in the medium term we believe that FDX is likely to deliver solid Express OR improvement which should support margin improvement and attractive upside for the stock. We recognize that there may be risk for FDX stock going into their 4QF13 earnings report on June 19 but we also believe that FDX stock already reflects muted expectations. " FedEx currently trades at $99.13.