FedEx Corp (NYSE:FDX) has been struggling during the past month as its share price has lost more than 30% of its value.
The delivery company had a strong performance in its most recent quarter with sales rising more than 9% and profits up by 21%. However, it still wasn’t enough to curb the recent bearish activity as the company also cut its forecast for the year, as it expressed concerns that the global economy will slow down in 2019.
However, there are many reasons to consider picking up Fedex.
The first, is that the stock is near its 52-week low and trading at only nine times earnings and a little over two times its book value. For a value investor, it hits a lot of the checkmarks you’re looking for.
From a growth perspective, there are also a lot of positives as lower oil prices will keep shipping-related expenses down and that can keep profits strong even if sales struggle. And even if the economy does start to slow down, it might be brick-and-mortar retailers that see most of that pain, as online shopping continues to be very popular among consumers.
Lastly, with the forecast already cut for 2019, it’s actually a good time to buy the stock because if FedEx is wrong and the economy still has a good year it’ll outperform the forecast, which could send the stock soaring. There’s certainly some risk that the company could still underperform those soft targets, but given all the other factors, it’s a risk that might be worth taking.
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