Tag Archives: FedEx

by | September 16, 2022 · 8:00 pm

A warning from FedEx

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.

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shinybull.com. The author has made every effort to ensure the accuracy of the information provided; however, neither Shinybull.com nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities, or other financial instruments. Shinybull.com and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | December 6, 2021 · 5:53 pm

Consumer Spending in November and December could grow as much as 11,5% and hit an all-time high

The times we are living in are far from «normal.» But we cannot blame an invisible virus for all that is happening right now. The question for retailers now is how this holiday season will look like?

Online spending on Black Friday 2021 decreased for the first time ever. According to Adobe Analytics, online shoppers spent a total of $8,9 billion, and that is down a little bit from last year’s $9 billion.

It can be many reasons for the dip, but Adobe believes it can be caused by an uptick in early spending, as some stores started sales and promotions as early as October. Shoppers are also being strategic in their gift shopping, buying much earlier in the season and being flexible about when they shop to make sure they get the best deals.

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Black Friday traffic in stores also dropped -28,3% from pre-pandemic levels. Cyber Monday did also have a bad day and dropped for the first time ever. Cyber Monday online sales drop -1,4% from last year to $10,7 billion.

Adobe expects the entire holiday season will see record-breaking e-commerce activity, as shoppers spread out their dollars over more days. Adobe anticipates digital sales from November 1st, to December 31st will hit $207 billion which would represent record gains of 10%.

FedEx forecasts Monday will be one of the highest volume e-commerce days of the 2021 holiday season as it prepares to deliver an estimated 100 million more packages than it did from Black Friday to Christmas in 2019.

According to National Retail Federation, the holiday season will be fine. Spending in November and December could grow as much as 11,5% compared with the same period a year ago. This is much higher than many retail analysts themselves had predicted.

Sales in November and December can hit an all-time high of between $834,4 billion and $859 billion. In other words; we`re on the path for a record holiday season. Omicron can destroy the holiday season, but it can also help.

Instead of taking a trip by plane to other places, consumers will spend their money on Target or Macy`s. That will boost consumer demand, helped by higher wages and inflation. A lockdown will increase online sales and put more pressure on FedEx. People want packages no matter what.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shinybull.com. The author has made every effort to ensure the accuracy of the information provided; however, neither Shinybull.com nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities, or other financial instruments. Shinybull.com and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | October 22, 2019 · 7:00 pm

Fast delivery is very important to some e-commerce Giants

Amazon is expected to report earnings on Thursday 24 after market close, and the consensus EPS forecast for the quarter is $4,46, and that is below the reported earnings for the same quarter last year that came in at $5,75.

I have been watching Amazon for two decades and it`s a big surprice to see that the company is still interesting. The company has been growing since the late 90`s and have now become a huge conglomerate with many businesses on top of its core business.

Amazon increased the shipping cost but what happens when its drones are taking over?

Cloud computing is one of the biggest winners at the conglomerate at the moment, and that`s also one of the biggest reasons why investors are holding their shares. It`s not their e-commerce business I`m looking at right now. It`s simply AWS (Amazon Web Services).

AWS made up about two-thirds of Amazon`s operating income last quarter. 13% of Amazon`s revenue comes from AWS. This is one of the most interesting part of the conglomerate with its great business model.

AWS grew 49% in the same quarter last year, and last quarter AWS reported a 37% growth and that is still a very great number. But it costs. Last quarter, Amazon reported that they had invested heavily in AWS.

Amazon added more personnel to the marketing team as well as the AWS`s technical team. Money makes money, and these investments should pay off in the long run.

Amazon have big competitors out there and one of the biggest are Rakuten in Japan and Alibaba in China. I receive many packages from them all and free and fast delivery is critical important to them all.

Jeff Bezos knows it and that`s why they now are in direct competition with FedEx and UPS to name a few. Amazon have recently started to ship third-party goods through its own logistics system, and that`s probably why FedEx made a decision to cut ties with them. This is probably why FedEx also reported negative results in its recent earnings.

According to Rakuten, Amazon has gone from shipping 15% of its own packages in 2017 to 50% today. Will they continue to ship its own packages through its own logistics system, and what is the percentage?

The shipping cost accelerated and can increase. On top of that Amazon still have its one-day shipping strategy which is a strategy not all of the e-commerce giants can follow up. I receive many packages from Ebay and sometimes it can take weeks and months to see the item arrive. But they have a different strategy.

Investors should look at it in the long run and keep in mind that the shipping cost can drop when the drones are coming to play the game. But it remain to see when that is happening.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | November 30, 2015 · 10:55 pm

Amazon revealed its new drone while online shopping is increasing

We can see a clear picture here. The busiest day of the year, Black Friday is declining while online retailers see sales are jumping. Black Friday sales fall nearly 11% from last year. How is it gonna be today; on Cyber Monday?

Some shops starts the sale the day before Black Friday and that can be a reason, but if you look at Thanksgiving, it also dropped this year by nearly 11%. Other retailers are offering bargains long before Thanksgiving and that can be another reason to the decline.

The biggest reason I think, is the increased online shopping which jumped 14,3% on Friday from last year. Many people doesn`t want to participate in the wild shopping crowds and prefer rather to shop online than in stores.

It`s Cyber Monday today and the term was created by marketing companies to persuade people to shop online. I wrote about both Black Friday and Cyber Monday in 2013, but nobody knew what it was. Now, many knows what Black Friday is but still today no one know what Cyber Monday is.

It`s probably to early for people in Europe. Cyber Monday made its debut on November 28, 2005, and quickly became one of the biggest online shopping days of the year. The trend is driving serious online discounts and promotions on Cyber Monday.

Thanksgiving, Black Friday and Cyber Monday means busy days for Amazon that revealed the latest prototype of drones.

 

 

Amazon are planning to deliver packages in under 30 minutes. The new drones weigh 55 pounds and can deliver packages weighing up to 5 pounds. Amazon has many prototypes, and they are ready to launch the service once the company has the «regulatory support.»

Google revealed that it wants to launch a drone service in 2017, while Walmart said they are now starting drone testing.

What about FedEx, UPS and DHL?

 

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by | March 17, 2015 · 5:58 pm

FedEx report on Wednesday morning

FedEx (FDX) is set to report fourth quarter earnings on Wednesday morning before the market open. Their rival UPS guided lower for its holiday period in January. According to some analysts, FedEx is in an «enviable possition» in the small package market.

Analysts say that the company`s cash levels are at an all time high, and their operations and fundamentals are extremely strong and suggest the potential for earnings and guidance upside. The company`s free cash flow has been a source of frustration for their shareholders in the past.

FedEx-Truck

Both FedEx and UPS are trading at about 4,6 percent free cash flow (FCF) yields based on 2016 estimates, but it is expected to see FedEx`s growth profile justifies the stock trading at a premium to UPS.

FedEx`s acquisition of Genco is fully funded and they can spend their $1 billion in a faster buyback or another acquisition. Growth expectations for FedEx are higher than their rival UPS, but UPS can be a better stock if you need income in the near future.

FedEx`s dividend yield is extremely low at 0,45 percent. If they continue to pay small dividends, they will have plenty of cash to buy back large amounts of its own shares and that will boost their own EPS.

I have talked about the transportation sector many times, and FedEx is one of them in this sector. The stock is up over 20 percent since last year, and the increase in price has pushed the dividend yield down to only 0,45 percent.

The street expected adjusted EPS of $1,87 on revenue of $11,79 billion. For Q4, adjusted EPS was estimated at $2,86 on revenue of $12,31 billion. Full year EPS was expected at $8,97 on revenue of $47,74 billion.

FedEx isn`t going to tell the market what they don`t already know on Wednesday. A better-than-expected earnings report could push the stock price up and above its 52-week high.

They cut costs in the express business to make up for lower volume, but that is not the way to grow. A resurgent U.S economy now affords the company a change to have its ground segment do all the heavy lifting for margins and profits.

The global economy is slow and so are China. A slower growth Chinese economy depends more on internal consumption and less on exports and that has been weighing on FedEx`s express segments for years.

Asia is slow, the U.S is picking up and the Europe is all about unfavorable foreign exchange. How will this impact the shares of FedEx? Let`s see on Wednesday. Expectations would put the company on track to reach its yearly goal of $8,50 to $9,00 in EPS. P/E is 22,48.

FedEx Corporation is now trading at $178,02. Up 0,39 percent.

 

 

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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