By Yasin Ebrahim
Investing.com – FedEx (NYSE:FDX) rose in after-hours trade on Tuesday after its fiscal fourth-quarter results topped analysts’ as demand for residential deliveries surged during the pandemic.
FedEx (NYSE:FDX) shares gained 8% in after-hours trade.
FedEx announced earnings per share of $2.53 on revenue of $17.40 billion. Analysts polled by Investing.com anticipated earnings per share of $1.7 on revenue of $16.45 billion.
“While commercial volumes were down significantly due to business closures across the globe, there were surges in residential deliveries at FedEx Ground and in transpacific and charter flights at FedEx Express, which required incremental costs to serve,” FedEx said.
“The company also incurred an approximate $125 million increase in operating costs related to personal protective equipment and medical/safety supplies, as well as additional security and cleaning services to protect our team members and ensure we are safely providing essential services for our customers.”
FedEx said it was not providing an earnings forecast for fiscal 2021 as the timing and pace of an economic recovery remained uncertain.
Capital expenditures for fiscal 2021 were targeted to be approximately $4.9 billion, a $1 billion year-over-year decline, due primarily to “reduced vehicle replacement spending and delayed facility investments,” it added.
FedEx shares are down 7% from the beginning of the year, still down 21.43% from its 52 week high of $178.50 set on July 24, 2019. They are under-performing the S&P 500 which is down 4.06% year to date.
FedEx follows other major Transportation sector earnings this month
FedEx’s report follows an earnings miss by Carnival ADS on June 18, which reported EPS of $-3.3 on revenue of $700 million, compared to forecasts EPS of $-1.59 on revenue of $773.9 million.
Deutsche Lufthansa ADR had missed expectations on June 2 with second quarter EPS of $-4.98 on revenue of $7.23 billion, compared to forecast for EPS of $-3.13 on revenue of $7.36 blllion.
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