FedEx (NYSE:FDX) is a Memphis-based company that provides transportation, e-commerce, and business services in the United States and around the world. Shares of FedEx were down 9.7% week-over-week as of mid-morning trading on Wednesday, December 20. Meanwhile, the stock is still up 41% so far in 2023. Its shares have climbed 52% in the year-over-year period.
This company released its second quarter (Q2) fiscal 2024 earnings after markets closed on Tuesday, December 19. Its shares were immediately hit in after-hours trading as the company stated that weaker overall demand had damaged its revenue outlook. Indeed, FedEx stated that it expects a low-single-digit drop in revenue for the full fiscal year. That is down from its previous guidance that called for flat sales in fiscal 2024. This marks the second straight quarter that FedEx has lowered its sales outlook.
FedEx’s Express unit, which is the largest at the company, faced challenges in Q2 FY2024 due to lower demand, surcharges, and a broader customer shift to cheaper services. The company expects “volatile macroeconomic conditions” to continue to hit consumer demand in the second half of the fiscal year.
In Q2 FY2024, FedEx reported adjusted earnings per share (EPS) of $3.99. That was down from the $4.18 in adjusted EPS that was projected by analysts. Moreover, revenues came in under expectations at $22.17 billion for the first half of fiscal 2024.
Shares of FedEx currently possess a price-to-earnings ratio of 14. That puts this stock in favourable value territory compared to its industry peers at the time of this writing.
