FedEx: UBS lowers PT to $293, maintains Buy rating.

FedEx: UBS lowers PT to $293, maintains Buy rating.

UBS Group has adjusted its price target for FedEx (FDX) stock to $293 from $297, while maintaining a Buy rating. This update comes amidst the company's fiscal Q1 preview, where UBS pointed to a modest downshifting in volume growth in mid-July in its business-to-consumer package business, as well as a worse-than-expected less-than-truckload shipment performance in Q1. The analyst expects FedEx to respond to these trends with additional cost reductions, trimming earnings estimates into the earnings report [1].

FedEx has been navigating challenges in its business-to-consumer package business, with mid-July seeing a slowdown in volume growth. Additionally, the less-than-truckload shipment performance in Q1 was worse than expected, indicating potential headwinds for the company's financials. Despite these setbacks, UBS remains bullish on FedEx's ability to manage costs and maintain its market position.

The company's strategy to reduce costs and improve operational efficiency is expected to mitigate the impact of these challenges. UBS believes that FedEx's strong brand and market leadership will enable it to navigate the current environment and continue to deliver value to shareholders. The analyst maintains a Buy rating on the stock, indicating confidence in the company's long-term prospects.

Investors should continue to monitor FedEx's progress as it adapts to the current market conditions. While the company faces near-term challenges, UBS's updated price target and Buy rating suggest that the market remains optimistic about FedEx's ability to drive growth and manage its debt load.

References:
[1] https://www.tipranks.com/news/the-fly/fedex-price-target-lowered-to-293-from-297-at-ubs-thefly