Reality Bites: Fedex Cuts Outlook On Global Growth Concerns

Tyler Durden's picture

...and so it begins - with a bellwether:

  • *FEDEX CUTS 1Q EPS FORECAST TO $1.37-$1.43, EST. $1.56

"Weakness in the global economy constrained revenue growth at FedEx Express more than expected in the earlier guidance."

FDX -4% AH and UPS -2.5% - both to lows of year!


This is not a good sign for GDP! (h/t @Not_Jim_Cramer)


FedEx Corp. (FDX) today announced that earnings for the first quarter ended August 31, 2012 are expected to be in the range of $1.37 to $1.43 per diluted share, compared to $1.46 per diluted share last year. The company’s original first quarter forecast was for earnings of $1.45 to $1.60 per diluted share.


Earnings during the quarter were lower than originally forecast, as weakness in the global economy constrained revenue growth at FedEx Express more than expected in the earlier guidance.


The company has not yet closed the books for the quarter. Additional information will be available on September 18, 2012, when the company releases a full earnings report at 6:30 a.m. CDT and conducts its quarterly earnings conference call at 7:30 a.m. CDT.

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redpill's picture

Just taking "Fed" out of their name would probably be good for a few bucks in stock price.

fireangelmaverick's picture

Actually if they made it Fed-Res-Express, their stock would probably triple.


King_of_simpletons's picture

This is actually good news. Will move Dow up 100 to 150 points. FedEx and UPS are not bankrupt yet. Even if they are bankrupt it is great news. Their name sounds good for another 200 or 300 point move up. Just great news overall. Simply move up up and up.

bdc63's picture

Correlation is a bitch

It's a FED, FED, FED EX world ...

TruthInSunshine's picture

I don't put faith in any "indicator" or "indicators" as I know that all datum is so heavily scrubbed and laundered (especially that put out by publicly traded companies) as to be of little predictive value in terms of timing based on fundamentals.

Having said that, if one wants as close to as pure a peek into accurate, real time data regarding the true state of the economy, the volume of garbage that's discarded is probably among the most pure and useful.

Garbage volume is a number that doesn't really have anyone manipulating it nor scrutinizing it, yet it reveals a lot about real time levels of consumption.

SeattleBruce's picture

That's interesting - do you have a good link for that stat?

pavman's picture

I would think garbage up, economy up.  Garbage down, economy down.  Duh.  I mean, bad economy = make shit last longer.  Good economy...who gives a shit, I just made $8M betting on QE^n!!!!  We're gonna throw out trash like its 1999!


vast-dom's picture

looking at the chart reality has not yet bitten....fucking QE can only lift indices, but never fundamentals outside of financials...unless Bernankzi starts injecting directly into any corporations that may impact said index.


insanity bites.


the 90s sure weren't correlating in that chart...

pavman's picture

The 90s were SOOOO last millenia.  Like OMG that was back when the Post Office wasn't bankrupt.

slaughterer's picture

Peope are just driving their packages to the recipient rather than paying FedEx to do it.  Plus there is a lot less "stuff" to send anyhow.  

vote_libertarian_party's picture

worser = gooder....BUY BUY BUY!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Rainman's picture

Magic 8-ball say Blowout Xmas coming...BTFD !!!!!!!!!!!!!!

Conman's picture

Waht happened did UPS get the Benny-buck shipment contract over them? QE not gonna bring back shipments?! The hell you say.

Jlmadyson's picture

Save maybe garbage and iron there is no other better indicator in the economy than Fed Ex.

But fear not Draghi and Benny Boy Bernake will save us all. Timmy G will be doing his best to save us from the debt ceiling as well.

And GDP will be a 4.0 print and CPI 0%.

Warm and fuzzy all over.

pursueliberty's picture

Transports period.

No need to move the unneeded.


The qe money doesn't make businesses further increase currently bloated inventory or cause people to buy/ship bloated inventory.  I'm not buying shit that isn't 65% off unless it shoots or is edible.

slaughterer's picture

DOW THEORY is now completely vaporized.  

pavman's picture

 I'm not buying shit that isn't 65% off unless it shoots or is edible.

I think you forgot shiny.

Randall Cabot's picture

Look how much money they will save on gasoline-BULLISH!!!

mjorden's picture

"Relax, it’s FedEx.

Bunga Bunga's picture

Car Sales August:

Germany -4.7% (YoY)

Portugal -33.1% (YoY)

Italy -20.2% (YoY)

France -11.4% (YoY)



buzzsaw99's picture

trannies take in it the dumper

Jlmadyson's picture

Obama really needs to fine tune this labor print this Friday like never before. Low enough to warm the printing presses but not too low that granny would jump ship.

Jason T's picture

tide is going up and the wave that just washed ashore is going back out... fast.  

Squid Vicious's picture

should be good for at least a 5 handle green open in the a.m. as QE3 goes from 120% to 130% priced in...

Temporalist's picture

These are not the green shoots you are looking for.


The summer of recovery has just begun.

cougar_w's picture

On-line orders killed the downtown small business just in time to implode and take the entire retail sector out with them!

How charmingly efficient.

Conman's picture

Must be bullish for Amazon right? becuase with razor thin margins and an insane PE , it must be good that shipments are down right?! Because QE will fix that.

SAT 800's picture

Reality is a Bitch, ain't it?

Rainman's picture

Let's look at the bright side. Those malls are going to convert easily to oustanding enclosed prison camps. Think taxpayer savings.

Meesohaawnee's picture

but but but CNBC just said everyone is buyin equities.. this cant be. they dont lie do they?

Catullus's picture

Exelon, power generator for a large portion of the northeast US making 8-year lows today too.

q99x2's picture

GDP seems to follow FedEx EPS but hasn't done so yet. Gross says QE in a week or so. That should make everything better. I"m thinking the same since GS's recent call to sell equities around the 14th.

TrustWho's picture

OMG....Daddy, Daddy help me. Here I am, don't worry little ones. I needed to feel some appreciation for all my good deeds. I will answer your prays. I have actully created a super duper printer and a tertiary process with my super clever off-balance sheet way of distributing this money to my friends. All zero hedge idiots will never be able to prove I was actually printing new money. They may create their conspiracy stories when inflation hits 25%, but Obama will just lock them in the psycho ward.  Obama will get elected and I get to keep my gig for another 4 years. I can't wait to see how much money I can print in the next 4 years to SAVE THE WORLD from great Depression II. By the time I am done, firewood will be worth more money than my new trillion dollar note. Oh by the way, Obama promised me I could have my picture on the Trillion dollar bill. Little ole me from SC, my Mom and Dad could never imagined!

Global Hunter's picture

Using shipping as any kind of indicator in regards to economic outlook is old fashioned and out of date.  The best metric to use is downloads, clicks or "friends".

Schmuck Raker's picture

That's right. Same with personal finance, I don't even check the balances in my accounts anymore - as long as my wallet's full of credit cards(and they haven't expired - that's key) I know i can shop with CONfidence.

Conman's picture

Nah no inflation there, not to mention all toll roads ways and tunnels/bridges in the area went up by 100% at the least. Where is this magical non-inflation or did the fed buy out webster and change hte definition?

SAT 800's picture

Not very long; and an excellent thing to watch.

SAT 800's picture

"Weakness in Global Economy, more than expected---"  Ha, Ha. Just wait, you haven't seen anything yet. You're gonna see "weakness" that'll make your eyes fall out.

Tinky's picture

While they obviously aren't immune to the coming storm, I must say that, having used them over many years, FedEx is an exceptionally reliable and well-run company.

pursueliberty's picture

Yes they are.  I only have a problem with the next day deliveries coming out of memphis when it is pretty big rainstorm.

Racer's picture

and naturally futures are up on all this dreadful news of a slowing eCONomy

asteroids's picture

OIH:FDX chart says that FDX is rolling over. But wait Obama will save you! He'll print more money and ship it using Fedex to pay for the people's food, gas, and mortgages. Maybe kick in a few bucks to help you buy a Volt.

tu-ne-cede-malis's picture

Come on Ben, hurry up and print.  This one-ply stuff is getting expensive!

Boilermaker's picture

ES down almost a FULL POINT!!!

Right, like this is going to have an effect at this point in the game.

Catflappo's picture

Sorry I am new to the site.... is this about Roger Federer?

Meesohaawnee's picture

and wall street just can figure out why not a soul wants anything to do with this joke,,agh.. excuse me, market

YesWeKahn's picture

QE3, lets print.