It's been a year and a half since Motley Fool Stock Advisor stalwart FedEx
What analysts say:
- Buy, sell, or waffle? Seventeen analysts follow FedEx, with nine voting buy and eight saying hold.
- Revenues. Just like last quarter, analysts hope to see FedEx report 9% quarterly revenue growth tomorrow, and $8.4 billion in sales.
- Earnings. Profits are predicted to rise 21% to $1.77 per share.
What management says:
CEO Fred Smith sums up FedEx's strategy for world domination "crisply" in the firm's last quarterly earnings release, as: ".balancing volume and revenue growth with cost containment to improve our margins."
What management does:
Bold words, and not easy to achieve for a firm that's seen one of its biggest operating costs, fuel, consuming increasingly large chunks of revenue. In fact, fuel costs have soared 45% so far this year. But by limiting most of its other operating costs to just single-digit increases in a year where revenues have increased 10%, FedEx has nonetheless managed to continue expanding its operating and net margins.
|
Margins % |
11/04 |
2/05 |
5/05 |
8/05 |
11/05 |
2/06 |
|---|---|---|---|---|---|---|
|
Fuel costs as a percentage of sales |
7.3 |
7.9 |
8.5 |
9.2 |
9.5 |
10 |
|
Operating |
8.2 |
8.6 |
8.4 |
8.3 |
8.7 |
8.8 |
|
Net |
4.8 |
4.9 |
4.9 |
4.8 |
5.1 |
5.3 |
The Fool says:
According to Fortune magazine, FedEx is the nation's No. 2 most-admired company (just behind GE
I couldn't agree more.
Competitors:
-
ABX Air
(NASDAQ:ABXA) -
UPS
(NYSE:UPS) -
Office Depot
(NYSE:ODP) -
Staples
(NASDAQ:SPLS)
Is past prelude? Could be. Just in case, you'd better read Stephen Simpson's write-up on FedEx's last quarterly earnings report.
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Fool contributor Rich Smith has no interest, short or long, in any company named above.
