FedEx (NYSE:FDX) is expected to deliver lower revenue but higher earnings when it reports first-quarter results after the closing bell on Wednesday as measures it is taking to transform its business gain traction.
Under its DRIVE program, the package delivery giant is aiming to become a more flexible, efficient and data-driven organization, while lowering its cost structure to drive profitability in a challenging demand environment.
It plans to achieve $1.8 billion in cost savings in its 2024 financial year and expects to realize margin improvement in both its Express and Ground businesses, with some of these already filtering through.
Based on 10 analysts’ forecasts, the company is expected to report a 6% decline in 1Q 2024 revenue to $21.8 billion, while earnings per share are likely to be 7% up at $3.68 a share from a year earlier, according to Zacks Investment Research.
Encouragingly, analysts at Barclays reiterated their positive stance on FedEx (NYSE:FDX) in a research report on Friday, with an ‘Overweight’ rating and a revised price target of $300.
Analysts surveyed by Zacks have an average 12-month price target of about $267 for the stock.
Ahead of its results, FedEx (NYSE:FDX)’s shares traded 1.7% higher at $252.90 just before noon in New York.
~updated with latest share price movement~
Contact the author at Stephen.gunnion@proactiveinvestors.com