Still Hard Going At FedEx

The operating environment for our first two quarters in fiscal 2010 is expected to be extremely difficult.

– Alan Graf Jr., CFO, Federal Express

Federal Express (FDX) reported fiscal 4th quarter earnings this morning.  Revenue in their core US Express unit was off 21% year over year.  They forecast EPS of 30-45 cents for the current quarter – well below analyst estimates for 68 cents.

FDX earned $3.76 last year.  Taking into account today’s 1st quarter guidance, it’s looking like about $3 this year.  At $51, that’s a 17 forward multiple.  Not cheap.

FedEx also provides a window into the economy as shipping volumes and revenues correlate to overall economic activity.  Still rough going out there.

Disclosure: Top Gun has no position in Federal Express (FDX) shares.