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.