FedEx Slashes Earnings Forecasts

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By Douglas A. McIntyre Updated Published

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There are not many companies the results of which are a nearly complete mirror of the global economy. FedEx Corp. (NYSE: FDX) comes close, as it ships tens of millions of packages a month for individuals and companies great and small based in well over 100 nations.

FedEx cuts its earnings forecasts today, based on, of all things, a damaged economy.

The shipper reported

earnings for the first quarter ended August 31, 2012 are expected to be in the range of $1.37 to $1.43 per diluted share, compared to $1.46 per diluted share last year. The company’s original first quarter forecast was for earnings of  $1.45 to $1.60 per diluted share.

Earnings during the quarter were lower than originally forecast, as weakness in the global economy constrained revenue growth at FedEx  Express more than expected in the earlier guidance.

As might be expected the company’s stock plunged — 3% — after hours, to $84.85. That is against a 52-week high of $97.19, and a low of $64.07. It is surprising the figure is not much lower, based on how bad the news is.

Douglas A. McIntyre

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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