FedEx (FDX) outpaces stock market gains: What you should know

FedEx (FDX) ended the recent trading session at $374.72, demonstrating a +1.42% change from the preceding day’s closing price. The stock outpaced the S&P 500’s daily gain of 0.05%. On the other hand, the Dow registered a gain of 0.1%, and the technology-centric Nasdaq decreased by 0.22%.

The package delivery company’s stock has climbed by 17.98% in the past month, exceeding the Transportation sector’s gain of 8.02% and the S&P 500’s loss of 1.99%.

The investment community will be paying close attention to the earnings performance of FedEx in its upcoming release. The company’s upcoming EPS is projected at $4.06, signifying a 9.98% drop compared to the same quarter of the previous year. Meanwhile, our latest consensus estimate is calling for revenue of $23.46 billion, up 5.89% from the prior-year quarter.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $18.38 per share and revenue of $92.6 billion. These totals would mark changes of +1.04% and +5.32%, respectively, from last year.

It’s also important for investors to be aware of any recent modifications to analyst estimates for FedEx. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.11% upward. At present, FedEx boasts a Zacks Rank of #3 (Hold).

In the context of valuation, FedEx is at present trading with a Forward P/E ratio of 20.1. For comparison, its industry has an average Forward P/E of 20.1, which means FedEx is trading at no noticeable deviation to the group.

It is also worth noting that FDX currently has a PEG ratio of 1.8. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. The Transportation – Air Freight and Cargo was holding an average PEG ratio of 1.87 at yesterday’s closing price.

The Transportation – Air Freight and Cargo industry is part of the Transportation sector. This industry, currently bearing a Zacks Industry Rank of 86, finds itself in the top 36% echelons of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.