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FedEx: The Good, The Bad And The Guide (According To Barclays)

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In a report published Thursday, Barclays analysts maintained an Equal-Weight rating on FedEx Corporation (NYSE: FDX), with a price target of $180.

FedEx shares have been trading in-line with the market so far this year.

The company is confident that its Express business will report a profit improvement of $1.2 billion over the level reported in FY13. "We are encouraged by management's confidence; but even best laid plans can be quickly upended by the market. Soft transport data, slowing industrial demand and higher inventories in the U.S. all weigh negatively for operationally levered FedEx," the analysts mentioned.

Strong e-commerce demand and rational pricing in the parcel segment are expected to have a positive impact on FedEx's future performance. "Balancing the good with the bad and spotting management on meaningful profit gains at Express, our model shakes out to roughly 19% growth for FY16, placing FedEx in the upper quartile within a challenged transport sector," the analysts commented.

In the report Barclays noted, "Express profit target is a big ask in FY16. Objectively speaking, we think reaching management's goal of $1.2bn in profit improvement at Express will be an uphill battle."

The EPS estimate for FY15 has been reduced from $8.94 to $8.92.

Latest Ratings for FDX

Feb 2017Raymond JamesUpgradesMarket PerformOutperform
Dec 2016Aegis CapitalInitiates Coverage OnBuy
Dec 2016JP MorganInitiates Coverage OnOverweight

View More Analyst Ratings for FDX
View the Latest Analyst Ratings

Posted-In: BarclaysAnalyst Color Reiteration Analyst Ratings


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