Earnings Preview: What to Expect From FedEx's Report

Memphis, Tennessee-based FedEx Corporation (FDX) is the leader in global express delivery services, providing transportation, e-commerce, and business services in the U.S. and internationally. With a market cap of $67.2 billion, it operates through FedEx Express, FedEx Ground, FedEx Freight, and FedEx Services segments. The freight and logistics giant is expected to release its Q2 earnings after the market closes on Thursday, Dec. 19.

Ahead of the event, analysts expect FedEx to report a profit of $3.88 per share, down 2.8% from $3.99 per share reported in the year-ago quarter. The company has surpassed Wall Street’s earnings estimates in two of the past four quarters while missing on two other occasions. Its adjusted EPS for the last reported quarter declined 20.9% year-over-year to $3.60, missing the consensus estimates by 25.3%.

For fiscal 2025, analysts expect FedEx to report an adjusted EPS of $19.59, up 10.1% from $17.80 in fiscal 2024. In fiscal 2026, its adjusted EPS is expected to grow 13.8% year-over-year to $22.30.

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FDX stock is up 8.7% on a YTD basis, lagging behind the S&P 500 Index’s ($SPX) 22.3% gains and the Industrial Select Sector SPDR Fund’s (XLI) 19% returns during the same time frame.

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Shares of FedEx plummeted 15.2% in the trading session after the release of its disappointing Q1 earnings on Sep. 19. The company reported a marginal drop in revenue compared to the year-ago quarter to $21.6 billion, falling short of Wall Street’s topline expectation, due to a mix shift toward deferred services, which redacted demand for U.S. domestic priority services and constrained yield growth. Moreover, adjusted non-GAAP operating income declined by a staggering 24% year-over-year to $1.2 billion, due to higher wages and purchased transportation rates. 

Observing Q1’s performance and prospects FedEx reduced its full-year revenue and earnings growth guidance, unsettling investors’ confidence in the company’s future performance.

The consensus opinion on FDX stock is moderately bullish, with an overall “Moderate Buy” rating. Out of the 27 analysts covering the stock, 17 recommend “Strong Buy,” one advises “Moderate Buy,” seven suggest “Hold,” and two advocate a “Strong Sell” rating. The mean price target of $310.93, suggests a potential upside of 13% from current price levels. 

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On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.