FedEx Q1 much weaker than expected, says Barclays

Barclays says FedEx reported much weaker than expected Q1 results, which management suggested was due to soft mix given still weak global Express package demand. However, a lack of cost savings in the quarter will be focus for skeptical investors as management remains committed to supposed $2.B in “structural cost reduction” this year, the analyst tells investors in a research note. The firm says FedEx management “platitudes went wide and deep on the call,” calling out “profitable market share gains” through initiatives such as Tricolor and cost savings. “But the unfortunate reality for FedEx is one of the worst first quarter profitability outcomes outside of the 2009 recession,” Barclays contends. It keeps an Overweight rating on the shares with a $350 price target.