Here's What The Street Thinks Of FedEx's Stellar Earnings Report

FedEx Corporation FDX released its third quarter earnings report on Wednesday and beat analyst expectations. The shipping company's EPS was $2.01 per share compared to the consensus estimate of $1.87 per share and revenue was reported at $11.72 billion, up from $11.3 billion a year ago.

"We had a very successful peak season as volumes grew across all transportation segments, and our profit improvement programs are moving ahead as scheduled," said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer. "We believe our strategy is sound, our culture is unique, and our customers value our broad portfolio of business solutions."

Top firms gave their opinion on FedEx.

Oppenheimer: Outperform, $200 price target

"We remain bullish on the FedEx story following solid execution and continued strong EPS growth in F3Q15….FedEx is lauded for its speed and service in its core FedEx Express segment, where it possesses the leading market share in "express" parcel delivery in the U.S., as well as a strong position in its emerging FedEx Ground segment...Anticipating a gradual economic recovery in the U.S. and internationally in coming years, we expect margin expansion via improved efficiencies and capital utilization, coupled with a realignment plan targeting improved annual profitability."

Citi: Buy, $200 price target

"FedEx reported a terrific quarter, driven by core Express improvements and fuel, but incremental expenses and a reversal of fuel to a headwind tempered F4Q guidance (implied by FY target) below our and consensus expectations. We continue to believe there is a lot to like about FedEx and the stock remains a top pick in Transports, but we are removing it from Citi's Focus List, as we are taking our estimates modestly below consensus and we believe the stock is somewhat catalyst-light in the coming quarter... we believe that its Express network will continue to right-size over the next year, while continued operational execution in Ground and Freight should aid margins."

RBC Capital Markets: Sector Perform, $169 price target.

"We believe FDX will be successful in re-engineering its profit improvement plan to extract a greater level of costs from the network, given the new normal for express shipping patterns, namely the continued sluggishness in the envelope business and international airfreight. This change in strategy gives us greater confidence in the company's ability to deliver the bulk of its profit improvement targets and ultimately significant earnings growth over a multi year timeframe.

"The expected profit improvement at Express combined with steady growth from Ground and Freight should drive a significant improvement in FDX's free cash flow profile."

Shares of FedEx closed Wednesday at $173.30.