FedEx Earnings: What to Watch
September 18 2017 - 7:29AM
Dow Jones News
By Paul Ziobro
FedEx Corp. is scheduled to report its fiscal first-quarter
results after Tuesday's market close. Here's what you need to
know:
EARNINGS FORECAST: Analysts polled by Thomson Reuters expect
FedEx to earn $3.14 a share, compared with $2.90 a share a year
earlier. For the full year, FedEx expects adjusted earnings of
$13.20 to $14 a share.
REVENUE FORECAST: Revenue of $15.38 billion is expected, up from
$14.7 billion a year ago.
WHAT TO WATCH:
CYBERATTACK FALLOUT: Analysts are scaling back their forecasts
for the year as FedEx grapples with the effects of last summer's
Petya cyberattack on its overseas delivery unit TNT Express. The
Dutch parcel division experienced delays because of the attack,
forcing it to divert some deliveries to FedEx's Express division.
FedEx doesn't have cyber insurance to cover the attack and warned
in July that it would have a material financial impact on its
results. Morgan Stanley analysts have said that discussion around
the attack and its fallout could dominate Tuesday's call.
HOLIDAY OUTLOOK: Investors will be listening for signs as to how
the busy holiday season is shaping up. Unlike rival United Parcel
Service Inc., FedEx opted not to impose surcharges around Black
Friday and Christmas, instead charging extra for bulky packages and
those that require special handling. Expect management to discuss
how shippers are responding to those added fees, as well as how
they see holiday shipping volume this year.
RATE INCREASE: FedEx, like UPS, typically announces price
increases for the coming year around this time. Both parcel
carriers have held steady with increases around 5% in recent years
to address the higher costs they're incurring from the influx of
e-commerce orders flowing through their systems. Any deviation from
that, or changes to other parts of the pricing structure, could
show how aggressive FedEx will be in trying to increase its
margins.
Write to Paul Ziobro at Paul.Ziobro@wsj.com
(END) Dow Jones Newswires
September 18, 2017 07:14 ET (11:14 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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