FedEx Corp (FDX) shares took a nosedive in early trading on Friday after the company unveiled a disappointing first-quarter earnings report. The results fell short of analysts’ expectations, leading to a significant decline in share price.
Several analysts weighed in on the news, with mixed reactions. BMO Capital Markets analyst Fadi Chamoun, while maintaining a Market Perform rating, reduced his price target from $325 to $300. He attributed the shortfall to weaker demand and a shift toward less profitable products.
Stifel analyst Bruce Chan remained optimistic, keeping his Buy rating but lowering the price target from $327 to $321. He highlighted that the DRIVE cost-saving program helped offset some of the elevated expenses, but the savings weren’t as substantial as anticipated.
Goldman Sachs analyst Jordan Alliger also reaffirmed his Buy rating but adjusted the price target from $332 to $328. He observed that the “freight recession continues, particularly in B2B and manufacturing,” and the company’s results were weaker than expected in key areas like Ground Commercial, Domestic Priority, and International Priority.
Stephens analyst Daniel Imbro maintained an Overweight rating and a price target of $350. He pointed to softer margins in FedEx Express (FEC) and weaker performance in FDX Freight as the primary drivers behind the missed earnings. He also acknowledged the company’s lower interest and other expenses.
Overall, the consensus among analysts suggests that FedEx is facing headwinds due to the persistent freight recession and a challenging macroeconomic environment. While some analysts remain optimistic about the company’s long-term prospects, the near-term outlook appears subdued.
