A key company for the North American market presented its balance sheet with good signs that encouraged investors.
FedEx it shoots up 14% in the premarket of Wall Street following the results it published corresponding to the fourth quarter that ended on May 31 and fiscal year 2024. The market received very well its profit forecast for 2025, above consensus estimates. The company has said that the reducing expenses and consolidating operations yields will rise even as demand for package deliveries remains weak.
The company anticipates FY2025 earnings of $20 to $22 per share, whose midpoint is slightly above analysts’ estimate of $20.92. The company is also evaluating whether you will keep or sell your freight transportation businesswhich generated revenues of 2.3 billion in the last quarter.
“(FedEx) shares rose sharply after the company announced better-than-expected revenue and earnings amid Huge cost reduction efforts that moderated capital spending. FedEx expects demand to improve moderately over the next fiscal year. Your accounts are considered to be an indicator of economic health“, writes Ipek Ozkardeskaya, senior analyst at Swissquote Bank, in his daily markets report this Wednesday.
The good data from FedEx
In the fourth fiscal quarter, FedEx revenues reached $22.1 billion, up 1% than in the same period of 2023 and above the market forecast of 22.06 billion. Net profit was 1.344 billion dollars compared to 1.25 billion in the previous year. Operating profit was 1.873 billion from 1.77 billion and the operating margin was 7.0% from 6.9%.
For the full fiscal year 2024, FedEx revenue fell to $87.7 billion from 90.2 billion in fiscal year 2023, while the net profit was 4.48 billion, exceeding the 3.84 billion in 2023.
During fiscal year 2024, FedEx returned approximately $3.8 billion to shareholders through a combination of 2.5 billion in share buybacks and 1.3 billion in dividend payments. Buybacks during fiscal 2024 totaled approximately 9.8 million shares, or 3.9% of shares outstanding at the beginning of the year, and increased fourth-quarter and full-year earnings by 0.21 and 0. $34 per share, respectively.
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FedEx: what is the company’s new plan
The company has announced a new share buyback plan of 2.5 billion (approximately 4% of the capital).
“We did significant progress in fiscal 2024 and we finish the year strongdelivering four consecutive quarters of operating income and margin growth in a challenging revenue environment,” said Raj Subramaniam, president and CEO of FedEx. “These are unprecedented results in this current environmentreflecting our continued execution of our DRIVE initiatives and our determination to transform FedEx while providing exceptional service to our customers. We expect this momentum to continue into fiscal year 2025. as we advance our efforts to create the most flexible, efficient and intelligent network in the world.”
Source: Ambito
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