FedEx Stocks Fall 2% on Company Outlook

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By Jacob Maslow

FedEx (NYSE:FDX) stocks fell by 2% on Wednesday morning. The company recently released a strong third quarter fiscal revenue report, earning $11.7 billion. This number is 4% higher than last year, but narrowly missed the $11.8 billion forecast by analysts. Net income for the quarter reached $580 million with earnings per share (EPS) reaching $2.01.

Growth in volume is why the company’s earnings rose so quickly.

High earnings wasn’t enough to keep the company’s stock from falling. Prices dropped by 2% for FedEx stock due to the company’s 2015 fiscal outlook that is lower than expectations. The company’s EPS projections for the year are $8.80 – $8.95. These numbers are slightly lower than analyst projections of $8.97 EPS.

Alan Graf, the company’s CFO, states that the company expects revenue and earnings growth to continue this year.

Investors shouldn’t be too worried about the stock as its year-to-year pricing has risen 26%. FedEx has benefited greatly from growth as well as reduced pension expenses and lower fuel costs.

The company’s ground segment is the key component of revenue growth, earning $3.39 billion. This is a 12% increase over last year. FedEx’s Express division earned revenue of $6.6 billion. The company’s freight division had earnings of $1.43 billion.

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