FedEx plummeted more than 20% on Friday, and it was the worst day ever for the stock, based on data going back to 1978, according to Dow Jones Market Data. I repeat the worst day for the stock since 1978!
The real reason for the drop is the demand for freight which dropped significantly. It isn`t funny to be a CEO when you know that your company has lost $11 billion in market value, but that`s a fact.
The company will take some essential steps to fix some of the problems. They will cut some costs. Cut worker’s hours. Park some aircraft, and close more than 90 FedEx Office locations.
CEO Raj Subramaniam isn`t optimistic about the economy and claims we will see a recession very soon. But he is not alone in saying so. The chief executive officer of McDonald`s Corp. said earlier this week he expects a minor US recession in 2023 and a more significant one in Europe.
Earnings from FedEx were worse than expected. Earnings came in at $3,44 a share, which is well short of the $5,10 average estimate of analysts. Revenue of $23,2 billion ended in August missed expectations. FedEx is trading at $161,02 on Friday.