Shares of FedEx Corp. fell Friday, as the package delivery giant’s warning of a disappointing earnings report didn’t go far enough, but some analysts found reason to be optimistic. The company reported late Thursday fiscal first-quarter profit and revenue that missed expectations, and announced plans to cut costs by up to $2.7 billion and raise shipping rates in the face of weakening demand, as historically high inflation weighed on consumer spending.
The results followed a profit warning from FedEx, which stunned Wall Street by coming just one week before the actual earnings report. The stock
FDX,
-2.85%
sank 2.6% in morning trading Friday, toward the lowest close since June 2020. It has plummeted 26.5% since FedEx issued its profit warning after the Sept. 15 close, highlighted by the record 21.4% plunge on Sept. 16. That compares with a 10.7% drop in the Dow Jones Transportation Average
DJT,
-2.60%
since Sept. 15, and a 1,324-point, or 4.3% selloff in the Dow Jones Industrial Average
DJIA,
-1.94%.
Also read: Why FedEx’s profit warning is such bad news for the U.S. economy. But in the face of all the doom and gloom, some analysts were able to find some bright spots. Evercore ISI analyst Jonathan Chappell said that while FedEx (FDX) has become a “show-me story,” given all the execution risks associated with its cost-cutting and rate-raising plan, he believes the “the good news” was that the company provided some specifics on the timing of the plan, and expressed “urgency” regarding its implementation. Chappell trimmed his stock price target to $225 from $243, but he reiterated his outperform rating. He also removed FedEx’s stock from Evercore’s “tactical underperform list,” which suggests the stock pro …