FedEx (NYSE:FDX) recently reported earnings for its first quarter of Fiscal Year 2023. Adjusted earnings per share came in at $3.44, which missed analysts’ consensus estimate of $5.14 per FDX share. In the past nine quarters, the company has beaten estimates 4 times.
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However, sales increased 5.45% year-over-year, with revenue hitting $23.2 billion compared to $22 billion. Still, this was lower than the $23.5 billion that analysts were looking for. This can be attributed to muted demand in global shipments, weakness in Asia and Europe, as well as high operating expenses.
In addition, the company demonstrated operating deleverage since it fell despite higher revenue. Indeed, the operating margin contracted from 6.4% to 5.1%. As a result, the company’s operating income decreased from $1.4 billion in the comparable period to $1.19 billion now.
Investor Sentiment for FDX Stock is Currently Positive
The sentiment among TipRanks investors is currently Very Positive. Out of the 566,302 portfolios tracked by TipRanks, 1.2% hold FDX stock. In addition, the average portfolio weighting allocated towards FDX among those who do have a position is 4.24%. This suggests that investors of the company are fairly confident about its future.
In addition, in the last 30 days, 2.5% of those holding the stock increased their positions. As a result, the stock’s sentiment is above the sector average, as demonstrated in the following image:
Is FedEx Stock a Buy, Sell, or Hold?
FDX has a Moderate Buy consensus rating based on 11 Buys, 11 Holds, and zero Sells assigned in the past three months. The average FDX stock price target of $236.14 implies 53% upside potential.
Takeaway – Investors Remain Confident that FDX Stock Will Bounce Back
FedEx saw a disappointing quarter as adjusted earnings missed significantly despite rising revenue. Nonetheless, investors remain confident that the company will bounce back as sentiment on the stock remains positive.
