HomeMost PopularWall Street Breakfast Podcast: FedEx Pops

Wall Street Breakfast Podcast: FedEx Pops

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FedEx (FDX) shares are experiencing a 5% premarket increase after exceeding sales forecasts. In the current fiscal year, the company expects flat revenue compared to previous projections of low-single-digit growth, surpassing the average analyst estimate of -0.17%. First-quarter earnings per share (EPS) of $4.55 outperformed expectations by $0.80, while revenue of $21.7 billion missed by $130 million.

The CEO of FedEx highlighted the outstanding performance of FedEx Ground, improved earnings at FedEx Express, and overall financial success resulting from expense controls across the organization. FedEx Express saw an 18% increase in operating income, driven by reduced operating expenses offsetting a 9% revenue decline. FedEx Ground’s operating income surged by 59% due to yield improvement and cost reduction.

However, FedEx Freight’s operating income dropped by 26% as a result of lower fuel surcharges and shipments, partly offset by base yield improvement. Year-to-date, FDX shares have increased over 41%.

Cleveland-Cliffs Refuses Standstill Agreement with US Steel

In other news, Cleveland-Cliffs (CLF) has decided not to sign a standstill agreement with US Steel (X) as the latter company accepts initial takeover offers. This move prevents Cleveland-Cliffs from challenging US Steel’s board of directors. Cliffs has already granted US Steel access to its books, as half of its $7 billion offer includes stock. Furthermore, Cliffs has received commitment letters from Wells Fargo (WFC), JPMorgan (JPM), UBS, and others, affirming their willingness to finance the bid. Recent reports suggest that US Steel may have interest from multiple bidders.

MGM Resorts Recovers from Hacking Incident

MGM Resorts (MGM) announced that all resort services, dining, entertainment, pools, and spas are now operating normally after experiencing intermittent issues caused by a hacking incident. Even the casino floor has returned to normal operation, although slot winners are still being paid manually. The only exception is at Excalibur, where guests may need to seek assistance from casino cashiers and slot guest representatives while operations continue to normalize. According to Macquarie analyst Chad Beynon, the hacking incident resulted in losses between $20 million to $40 million for MGM Resorts.

Shares of MGM Resorts have declined more than 5% in the past week, compared to a 1.4% drop in the Dow Jones U.S. Gambling Index during the same period.

Market Updates and Catalyst Watch

On Wednesday, U.S. stocks closed significantly lower, with the 2-year Treasury yield reaching a level not seen since 2006. The Dow ended 0.22% lower, the S&P 500 retreated 0.94%, and the Nasdaq had the worst performance with a 1.53% decline. Treasury yields rose, with the 2-year yield increasing by 3 basis points and the 10-year yield up by 2 basis points.

As of 6 am, Dow, S&P, and Nasdaq futures are all down. Crude oil prices have dropped by 0.8%, trading at less than $89 a barrel, and Bitcoin is down 1.2%. The FTSE 100 and the DAX are both experiencing declines of 0.6% and 1% respectively.

The biggest premarket movers today include Klaviyo (KVYO), which saw a 4% decrease after a strong debut that initially boosted the stock by 32% before settling 9.2% higher at $32.76. In terms of economic indicators, the Philly Fed business outlook report is scheduled for 8:30 am, followed by existing home sales at 10 am.

For more market news, visit Seeking Alpha:

  • Hollywood strike negotiations resume as writers and studios return to the bargaining table
  • Toshiba’s 74-year run as a listed firm concludes with a $13.5 billion buyout
  • KB Home Q3 earnings reflect steady demand despite a slight decrease in average sales price

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