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Investing.com -- DHL Group’s stock surged more than 11% on Thursday following its fourth-quarter results, which exceeded market expectations.
The logistics company reported an operating profit (EBIT) of €1.85 billion for the quarter, about 4% above consensus estimates, with strong performance in its Express segment helping to drive the gains.
Analysts at Barclays (LON:BARC) noted that the better-than-expected results were mainly due to solid pricing strategies and cost controls within the Express division, where EBIT came in 11% ahead of expectations at €1.08 billion. The company’s overall revenue grew 6% year-over-year, reaching €22.7 billion for the quarter.
Despite the strong finish to 2024, DHL issued a cautious outlook for 2025, forecasting an EBIT of at least €6 billion, which falls short of the market consensus of €6.29 billion.
The company also adjusted its 2026 EBIT target to a medium-term goal of €7 billion, citing macroeconomic uncertainties.
"However, we think management taking a more cautious view and removing an overhang from guidance being too high could be also seen as a positive," Barclays said in a note.
"We see this set of results as mixed but supportive for the investment case, opening small up," Barclays added.
In an effort to support its share price and return capital to investors, DHL announced a €3 billion share buyback program spread over 2025 and 2026, equating to €1.5 billion annually.
This move is expected to boost total cash returns to shareholders, including dividends, to around 8%.
Other business segments delivered mixed results. The Post & Parcel division posted EBIT of €326 million, exceeding expectations by 3%, while the Global Forwarding and Freight division underperformed with EBIT of €255 million, about 7% below consensus.
The eCommerce segment saw EBIT rise 39% year-over-year to €106 million, ahead of expectations.
Barclays maintains a "neutral" rating on the stock, with a price target of €38, slightly below its latest closing price of €38.77.