FedEx Corp (FDX) and United Parcel Service, Inc. (UPS) shares took a tumble on Friday, following FedEx’s disappointing quarterly earnings report. The shipping giant revealed that its first-quarter revenue and earnings fell short of analyst expectations, leading to a downward revision of its full-year outlook.
FedEx attributed the decline in performance to a challenging quarter marked by lower U.S. domestic priority package volume and rising costs, including wages and purchased transportation rates. The company’s revised guidance now anticipates low single-digit growth in revenue for fiscal year 2025.
The news sent ripples through the market, impacting UPS shares as well. While UPS is set to report its third-quarter results at the end of October, investor sentiment was clearly influenced by FedEx’s performance.
Analysts are divided in their outlook for FedEx. Morgan Stanley’s Ravi Shanker downgraded FedEx stock from Equal-Weight to Underweight and lowered the price target from $215 to $200. Baird, on the other hand, maintained its Outperform rating but reduced the price target from $340 to $320.
Looking ahead, Wall Street analysts have an average 12-month price target of $318.26 on FedEx. The Street high target is currently at $359, and the Street low target is $200. Of the analysts covering FedEx, 16 maintain positive ratings, 2 hold neutral ratings, and one has a negative rating. In the last month, 6 analysts have adjusted price targets.
While the immediate future for FedEx stock remains uncertain, its year-to-date performance of 19.09% suggests potential upside ahead. For a comprehensive overview of FedEx, you can visit [link to FedEx information].
At the time of publication on Friday, FedEx shares were down 13.2% at $260.92, while United Parcel Service shares were down 2.67% at $128.60.
