Companies that trade at too big a discount unlock value by splitting the business.
After posting quarterly results, FedEx (FDX) said it would separate its freight operations. The tax-free separation will make FedEx Freight an independent publicly traded company. CEO Raj Subramaniam said that the decision unlocks value for its Freight business and enables both firms to respond to the unique dynamics of the shipping market.
In the second quarter, FedEx earned $741 million, or $3.03 a share. For the year, it now expects flat revenue growth, down from a low single-digit percentage growth forecast.
Nike (NKE) will trade flat to slightly up when the markets open. The firm posted revenue falling by 7.8% Y/Y to $12.35 billion. Sales from NIKE Direct fell by 13%, wholesale revenue was down 3%, and gross margin fell by 100 basis points to 43.6%. Nike’s sales are not keeping up with inflation rates, which are around 3% annually.
Bitcoin (BTC-USD) will try to rally back from a $96,000 low which it reached yesterday. After the Nasdaq 100 (QQQ) added Microstrategy (MSTR), it might lift BTC prices. The software firm’s book value is mostly in its bitcoin holdings. So, its inclusion on the index is indirectly linked to BTC price fluctuations.
