Today is Wednesday, June 21, 2023.
The Early Bird Index today is 56.87.
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FedEx's "Demand Weakness"
Disappointing financial results caused shares of FedEx (NYSE: FDX) to drop by 3.09% in after-hours trading on Tuesday.
Financials: FedEx reported earnings of $4.94 per share in the past quarter, which was better than expected. But revenue was only $21.9 billion, which was lower than expected.
Details: The company reported a lower operating margin for the fiscal year, and the results in the quarter were especially bad. FedEx said the results were affected by “continued demand weakness and cost inflation.” FedEx Freight decreased due to lower shipments and FedEx Express dropped due to lower global volumes.
But: Cost-reductions helped the results a bit. FedEx Ground also improved due to higher revenue per package.
Also: CFO Michael C. Lenz announced plans to retire at the end of July.
Outlook: FedEx expects flat to low-single-digit-percent revenue growth for the year, which is better than expected. But the company’s projected earnings per share for the year were lower than what analysts wanted.
Sympathy Pains: UPS (NYSE: UPS), which is trying to negotiate a new contract with workers, dropped 1.13% in after-hours trading.
Final Thoughts: It is great that the cost reduction plans are working, but investors expected more out of FedEx. The company needs to capitalize on the fact that its competitor UPS might be dealing with a worker strike this summer. Experts still consider FedEx to be a value stock pick.
Notable Earnings Today: Winnebago (NYSE: WGO), KB Home (NYSE: KBH), Patterson Companies (Nasdaq: PDCO), Avid Bioservices (Nasdaq: CDMO), Steelcase (NYSE: SCS), Algoma Steel Group (Nasdaq: ASTL).
Notable IPOs Today: 60 Degrees Pharmaceuticals, Inc. Common Stock (Nasdaq: SXTP), Northern Lights Fund Trust II (NYSE Arca: FFLS).
Notable Equity Crowdfunding Campaigns Ending Today: Xairos (StartEngine), Voltaic Marine (StartEngine).
Notable Economic Events Today: Fed Chair Powell Testifies (10:00 a.m. ET), API Weekly Crude Oil Stock (4:30 p.m. ET).
Bitcoin Gets Institutional Boost
Photo by Michael Förtsch / Unsplash
The price of Bitcoin surged by about 7% on Tuesday, one of its strongest days in recent weeks, as large financial institutions show more support for cryptocurrency.
Details: A new cryptocurrency exchange started by Citadel Securities, Fidelity, and Charles Schwab (NYSE: SCHW) launched on Tuesday. Last week, BlackRock (NYSE: BLK) decided to file paperwork for a spot Bitcoin ETF (exchange-traded fund). It is clear that investors are becoming more bullish about Bitcoin.
Price: Bitcoin is up 8% this week and it now reaching its highest level since May. In the past 12 months, Bitcoin is up nearly 40%.
Final Thoughts: There’s still the threat of potential regulations coming to cryptocurrency this year, which could be a problem for Bitcoin.
La-Z-Boy’s Bad Outlook
Although La-Z-Boy (NYSE: LZB) posted better-than-expected earnings on Tuesday, shares dropped 5.24% in after-hours trading due to a bad outlook from the company.
Final Thoughts: Shares of La-Z-Boy are up nearly 20% this year, but these results are a setback.
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Trends to Watch
Sticker Shock: Paramount’s BET sale in doubt as Tyler Perry balks at $3B price, sources say (New York Post)
Everywhere You Want to Be: Visa names EA exec Chris Suh its next CFO (MarketWatch)
Make it Make Sense: Why Tesla’s Stock Rally Doesn’t Make Sense—in Eight Charts (The Wall Street Journal)
No Giving: Charitable Giving in the U.S. Falls for the First Time Since the Financial Crisis (Barron’s)
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