FedEx Corporation (NYSE:FDX) shares are surging Wednesday on news that the company has upwardly revised its earnings forecast. The stock is up almost 5% as of 11:10 AM ET today, trading up $6.49 at $146.80.
The iconic shipping and logistics firm provided an earnings and operations update today, revising previous guidance upwards above consensus analyst estimates.
Revised Fedex earnings forecast
FedEx Corporation (NYSE:FDX)’s statement today suggested an annual profit range exceeding analysts’ estimates as the firm begins to cash in on its three-year turnaround plan. The company also foresees continued moderate economic growth.
According to the statement, FedEx Corporation (NYSE:FDX) earnings for the current fiscal year ending in May are anticipated be $8.50 to $9 a share. That compares with an average analyst estimate of $8.73 among the 27 analysts surveyed by Bloomberg.
The world’s largest cargo airline also now anticipates U.S. economic growth of 3.1% in 2015, up from just 2.2% this year. Global growth is also projected to ramp up to 3.1% next year after just 2.7% in 2014.
“Fiscal 2014 was a good year for FedEx and we expect fiscal 2015 to be even better,” FedEx Corporation (NYSE:FDX) CFO Alan B. Graf said in a statement.
“The amount of freight and packages are looking pretty good, and that’s a good indication for the economy,” added Logan Purk, a St. Louis-based analyst at Edward Jones & Co., in a conference call following the earnings release.
The firm’s U.S. economic forecast for 2015 was upped by 0.1 percentage point from the previous projection.
Fourth quarter results
Revenue for 4Q increased at FedEx Express, the company’s largest unit, as package volume rose a solid 2%. The average daily volume of ground shipments increased by 8%, driven largely by e-commerce. Daily freight shipments were also up by a robust 12%.
Furthermore, operating income at FedEx Express was up 3% to just over $475 million as revenue increased around 1% to $7 billion. International shipments were up an impressive 5%, while international priority volume remained the same.
FedEx Corporation (NYSE:FDX) made a profit of $2.46 a share in the fourth quarter, exceeding the consensus analyst estimate of $2.36. Total revenue of $11.8 billion also surpassed analyst expectations.