FedEx Delivers More Money

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There's no moss growing on your neighborhood FedEx (NYSE: FDX) truck these days. In addition to snagging some important U.S. Postal Service business from rival DHL Worldwide Express, the firm is finishing up its smart-looking acquisition of formerly private Kinko's.

If you doubted FedEx anyway, today's announcement of increased earnings ought to convince you to look again. The firm now expects to post fourth-quarter earnings of $1.36 per share, including a $0.04, one-time tax benefit, and $0.01 in restructuring costs. That tally compares very favorably to the $0.92 per share earned in the prior-year quarter -- a 48% jump -- or the $1.25-ish results that management had looked for earlier in the year.

Anyone who's been watching the company might have seen this coming. I myself was wowed by the solid revenue increases and margin improvement that drove last quarter's impressive growth.

Now that this has become such a habit with FedEx, I was about to write something clever like, "Maybe this should be a Motley Fool Stock Advisor pick." Turns out I haven't been paying close enough attention. It is a Stock Advisor pick, and has been since February of 2003. Heck, if you had dawdled until March, you'd still be looking at a 46% gain to today, 10 points better than the S&P 500's advance over the same period.

Is it worth taking the leap now? Well, compared to larger competitor UPS (NYSE: UPS), FedEx has a higher P/E. But the firm is also experiencing faster growth and improving margins. That means it's probably a better deal, by comparison. And if it's true that gas-price worries might be fuel for dot-com retailers like Amazon.com (Nasdaq: AMZN), eBay (Nasdaq: EBAY), and Overstock.com (Nasdaq: OSTK), FedEx may do even better.

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Fool contributor Seth Jayson owns no company mentioned. View his Fool profile here.