Nucor earnings beat by $0.08, revenue fell short of estimates
On Friday, Bernstein SocGen Group has revised its price target for FedEx (NYSE:FDX) shares, decreasing it significantly from $320.00 to $202.00. The firm has opted to maintain a Market Perform rating on the stock. Currently trading at $241.87, InvestingPro analysis suggests the stock is undervalued despite recent market challenges. Analyst David Vernon provided insights into the decision, citing several factors that could impede the company’s performance.
Vernon pointed out that the expected benefits from the company’s drive and Network 2.0 initiatives are likely to be hindered by difficult end markets. With FedEx set to report its earnings on March 20 after the market closes, investors will be watching closely how the company’s $87.39 billion revenue base and healthy EBITDA of $10.87 billion translate into future performance. Vernon updated his model and emphasized key questions regarding the company’s future outlook.
The analyst believes that while the stock holds value at current levels, the forecasted earnings for 2026 are anticipated to be 10% lower than the consensus estimates. This outlook is affected by the added uncertainty surrounding global trade and the challenges associated with network integration.
Vernon also noted that the current stock market conditions could impact the timing of a potential Freight division spin-off, contributing to his neutral stance on the stock. The revised price target of $202 reflects a cautious approach due to policy uncertainty and near-term integration risks that FedEx faces.
In other recent news, Dexterity Inc., an AI robotics startup, has achieved a valuation of $1.65 billion following a $95 million investment round, bringing its total capital raised to nearly $300 million. This investment highlights growing interest in AI-powered machinery, with strategic investors like Sumitomo Corp. (TYO:8053) contributing to the funding. On a different note, FedEx announced it has halted economy parcel and freight services to Saudi Arabia from several countries, including Brazil, India, and China. The suspension is temporary, though no timeline has been provided for resumption.
In another development, FedEx revealed it would change its fiscal year-end to align with the calendar year starting June 1, 2026. This move is expected to streamline financial reporting and align it with standard corporate practices. Meanwhile, Citi has adjusted its financial outlook for GXO Logistics, reducing the price target to $56 while maintaining a Buy rating. The revision reflects concerns about foreign exchange headwinds due to significant revenue generation outside the United States. Additionally, FedEx’s stock faced pressure as UPS released a revenue forecast below market expectations, highlighting weaker demand in the parcel delivery sector. UPS’s strategic decisions, including reducing Amazon.com (NASDAQ:AMZN) package volumes, have raised concerns about potential impacts on FedEx’s business.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.