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FedEx Stock Forecast

FedEx is an overlooked opportunity and that’s why I’m sharing a FedEx stock forecast today. The company continues to benefit from increased shipping.
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FedEx (NYSE: FDX) stock is an investment that is not usually front-of-mind for many people. This is an overlooked opportunity and that’s why I’m sharing a FedEx stock forecast today.

You might see a truck go by on the interstate in either the orange and purple logo or the green. You might receive a package from them, but for me anyways it’s a rare occurrence.

Despite its seeming elusiveness, FedEx is a huge company with many divisions.

Below I’ll go into more depth about whether FedEx is a good investment.

FedEx Stock Forecast – Company Intro

FedEx is primarily a shipping company. That’s what it’s best known for. It offers a variety of print, design and promotional products, too.

It has many different branches, which headquarter in various places around the U.S. But it’s mostly in Memphis, Tennessee.

The company has been innovative, with a focus on time-sensitive shipments. It was the first company to offer online tracking and online shipment processing. And FedEx is still innovating today, using robots and drones to deliver packages.

The statistics on its website are very impressive. It connects 99% of the global GDP and has an average daily volume of 18 million packages. That last stat goes for the FedEx Corporation alone.

FedEx has separated into seven different branches. Each one handles a different body of work.

FedEx Corporation caters more to businesses. FedEx Express handles air-ground time sensitive packages. There are five others that each have a different role. There’s FedEx Services, FedEx Ground, Freight, Office and Logistics.

Also, each one has a different color logo. Which explains the orange and green differences you see on the highway. Apparently, that actually means something.

FedEx Stock Observations

Going into 2020, FedEx stock was in the midst of a bear run. Then COVID hit and brought the stock price soaring. It hit its peak at the end of May 2021. From its lows at the start of the pandemic to its high, it rose about 200%.

Since then, it’s been correcting and declining. But it’s still much higher than it was a year and some months ago.

Trading Volume

FedEx stock volume has remained steady, with a gradual spike happening last year. Since then, volume has declined. That isn’t to say it won’t come back up again soon. It very well may do so, especially with all the new employees and workers coming in before Christmas. As it gets closer to the holidays, I expect volume to rise again.

As mentioned, FedEx is often overlooked, along with its industry. Although, there are many industries and investments like this that have produced great returns for investors. For example, check out these top fast food stocks and travel stocks.

FedEx Financial Health

FedEx’s total debt comes in close to $40 billion. Don’t be alarmed, though. It also has close to $83 billion in total assets. With these numbers a debt-ratio comes in below 0.5, which is solid.

In the transportation industry, the average ratio is around 0.6. Investors usually look for companies with 0.3 to 0.6, so FedEx is well within this range.

For May of 2021, FedEx reported over $22 billion in sales and close to a $2 billion net income. This gives it a healthy net profit margin of 8.28%.

There was a study done by New York Stern’s School of Business. It confirmed the average American transport business brings in 3.88% in net profits. FedEx is flying very high this year with its 8.28%.

Its revenue, net income, diluted EPS, net profit margin, operating income and cash on hand are all up in very healthy amounts.

There are two “negatives” that I see from a quick look at its recent financial report. One is that the cost of revenue has gone up by 10%. The other is that the “net change in cash” says it has $1.77 billion less than the last year.

These are not necessarily bad, though. You also must think about its recent great profit margins. And the fact that it’s growing its team like crazy.

Paired together, these two factors most likely mean it’s expanding and reinvesting. Which is a good thing. I assume these two changes are directly related to its preparation and onboarding of 90,000 new employees this year. That number is almost 30% higher than last year’s number of new workers.

FedEx Stock News

FedEx has recently paired up with Salesforce. It plans to create an end-to-end e-commerce solution. And it expects it to be ready by Spring of 2022. It wants to improve customer experience, while allowing businesses to easily handle inflated demand. This is a key consideration that plays into a FedEx stock forecast.

Like I said earlier, FedEx also plans to hire 90,000 new employees before Christmas. Last year, it onboarded 70,000 new workers. So, it is really taking advantage of the momentum from COVID. It’s adding around 30% new hires this year over last.

In the past couple of years, sometime in 2019, FedEx and Amazon decided not to renew its contract. The contract was for FedEx to deliver packages for Amazon. I’m not sure who initiated ending the relationship.

FedEx saw that Amazon was trying to compete with them. It started to deliver its own packages and provide its own ground shipping. Amazon was a small piece of FedEx’s entire business puzzle, though. So, FedEx is not suffering because of that.

It may also just be a peaceful transition. One where FedEx knew Amazon would want to provide its own shipping. And so, FedEx helped Amazon until it could handle things on its own.

Either way, I highly doubt FedEx is suffering.

One cool thing that happened in 2016. FedEx went into an agreement with Red Rock Biofuels to buy alternative jet fuel made from wood waste. Exploring different energy sources like this might help lower costs over time.

Is FedEx Stock a Good Buy Now?

FedEx stock is on a correction right now. The company has visions for the future, and it has a history of innovation and success.

Right now, FedEx gets an average hold rating from many analysts. It’s still well above its pandemic lows and the recent pullback makes it a better value opportunity. It has a current P/E ratio of 13. The industry average is close to 17.

It may be wise to watch it for a bit and see what happens. If it goes down, it may present a great buying opportunity. If the stock goes up, it might be smart to hold off a bit and wait for a bigger decline.

The company is aggressively expanding, though. And it will only have more revenue coming in before the holidays, and when the holidays hit.

Another thing to keep in mind is that you won’t always get “the perfect price” on a stock. If a company has had great success in the past, it will likely continue to have great success in the future.

And FedEx has indeed had great success in the past. If you’re looking for more investing opportunities, sign up for Wealthy Retirement below. It’s a free e-letter that’s packed with tips and tricks. You’ll hear from one of the best income experts, Marc Lichtenfeld. He literally wrote the book on how to get rich with dividends.

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Economics

DAX index forecast ahead of the ECB meeting

European stocks rose on Friday on a surge in technology stocks; still, rising inflation became a concern for investors. European inflation was confirmed at 3.4% YoY in September, and concerns grew that the European Central Bank could change its monetary..

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European stocks rose on Friday on a surge in technology stocks; still, rising inflation became a concern for investors. European inflation was confirmed at 3.4% YoY in September, and concerns grew that the European Central Bank could change its monetary policy.

European Central Bank President Christine Lagarde said that ECB would maintain its accommodative policy for as long as necessary, but this could change soon. Germany’s DAX index has advanced again above 15,500 points, but it is still trading below its recent highs.

Germany’s recovery from the pandemic has been strong so far, and the country will release the preliminary estimates of its October Inflation data and its Q3 GDP next week.

Results from many big companies provided a strong start to third-quarter earnings, and investors’ focus will remain on the third-quarter earnings season because many companies have yet to publish their reports.

Next week, Deutsche Bank, Volkswagen,  Linde, MTU Aero Engines, and Daimler are among the companies scheduled to report quarterly results.

According to the German Economic Ministry, the outlook for the industry remains positive, but the world’s supply chains crisis represents a serious problem for Germany because of its dependence on exports.

The German economy is particularly vulnerable to shortages of key parts and raw materials, and more than 40% of companies reported they had lost sales because of supply problems.

Many big companies scaled back production of some of their most profitable models, while Opel announced last month that it would shut down a factory in Eisenach until the beginning of 2022.

It is important to say that nearly half of Germany’s economic output depends on exports of cars, machine tools, and other goods, while the semiconductor shortage throttling global car production suggests more pain for the automotive industry.

Despite this, the German Economic Ministry reported that it expected this effect to be temporary while the German central bank expects that the German economy could grow 3.7% this year. The German Economic Ministry added:

Healthy order books give us reason to expect strong recovery impulses from industry, and thanks to that strong overall economic growth

The European Central Bank recently reported that exports from Eurozone would have been at least 7% higher in the first half of the year if not for supply bottlenecks. The European Central Bank will announce its decision on monetary policy next Thursday, which could significantly influence on DAX index in the near term.

15,000 points represent support

Data source: tradingview.com

DAX index has advanced again above 15,500 points, and if the price jumps above 15,800 points, the next target could be at 16,000 points.

On the other side, if the price falls below strong support that stands at 15,000 points, it would be a strong “sell” signal, and the next target could be around 14,500 points.

Summary

The European Central Bank will announce its decision on monetary policy next Thursday, which could significantly influence on DAX index in the near term. DAX index has advanced again above 15,500 points, and if the price jumps above 15,800 points, the next target could be at 16,000 points.

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Economics

Poland Will Not Be “Blackmailed” Into Accepting European Union Laws, PM Morawiecki Says

Poland Will Not Be "Blackmailed" Into Accepting European Union Laws, PM Morawiecki Says

Authored by Naveen Athrappully via The Epoch Times,

Polish Prime Minister Mateusz Morawiecki said on Thursday that his country will not bow to the Europe

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Poland Will Not Be "Blackmailed" Into Accepting European Union Laws, PM Morawiecki Says

Authored by Naveen Athrappully via The Epoch Times,

Polish Prime Minister Mateusz Morawiecki said on Thursday that his country will not bow to the European Union’s “blackmail” on deciding legal frameworks of member states, but is open to constructive dialogue.

Arriving at a summit of the 27-member bloc, Morawiecki said that Poland “was as faithful to the rule of law as others and as the EU institutions are.” He added,

“Some EU institutions assume the right to decide on issues to which they have not been entitled to decide. They assume competencies which have not been handed over to them in the treaties.”

Morawiecki said that EU laws maintain supremacy over national laws on matters transferred to the EU. “We don’t agree to the constantly broadening range of competencies but we will, of course, talk about it.”

On Oct. 7, Poland’s Constitutional Tribunal ruled that some elements of EU law were incompatible with the country’s constitution. This ruling, criticized by Brussels, essentially gave national law primacy over that of the EU.

“It has to be clear: You are a member of a club, you have to abide by the rules of the club. And the most important rule of the club is that the European law is over national law,” the EU’s top diplomat, Josep Borrell, told Reuters.

Since the nationalist Law and Justice (PiS) party took over power in 2015, the ideological conflicts have incrementally increased.

European Parliament President David Sassoli said the Polish tribunal’s ruling challenged “the legal bedrock of our Union,” and that, “never before has the Union been called into question so radically.”

European Commission President Ursula von der Leyen laid out three options as a response.

The first option, “infringement,” is where the commission legally challenges the verdict of the Polish court.

The second option, which is active currently, involves the withholding of funds. Warsaw will not be able to access the 36 billion euros ($42 billion) of COVID-19 pandemic recovery grants. This could lead to a further blockage of around 70 billion euros ($81 billion) set aside for development projects in the 2021-2027 budget.

The third option would be the implementation of Article 7 of the EU treaty which suspends member states of certain rights, including the right to vote on EU decisions.

Morawiecki, however, maintained his country’s stance under repeated criticism in the tense debate on Tuesday. This led to the idea of Poland exiting the bloc which the prime minister dismissed. He said that there were no plans for a “Polexit” as there is considerable support among the Polish for remaining within the EU.

A majority of European countries, including Ireland, France, Sweden, Finland, Luxembourg, and the Netherlands were critical of Poland, barring staunch ally Hungary. Hungarian Prime Minister Viktor Orban has not been a supporter of excessive European Union interference in the laws and decisions of member states.

“Poland is one of the best European countries. There is no need for any sanctions, it’s ridiculous,” Orban said.

Dutch Foreign Minister Ben Knapen implied the issue will soon need to be addressed.

“The time for talking is never over, but it doesn’t mean that you cannot take action in the meantime,”  Knapen said. “It’s going to come soon.”

Outgoing German Chancellor Angela Merkel called for finding “ways of coming back together,” and warned against isolating Poland, the largest ex-communist EU country of 38 million people.

Tyler Durden Sat, 10/23/2021 - 09:20

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Economics

Should I invest in Coca-Cola shares after a positive view from Morgan Stanley?

The Coca-Cola Company (NYSE: KO) shares have weakened from their recent highs above $57, registered in August 2021, and the current price stands at $54.45. Coca-Cola declared a $0.42 per share quarterly dividend last week, and Morgan Stanley continues…

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The Coca-Cola Company (NYSE: KO) shares have weakened from their recent highs above $57, registered in August 2021, and the current price stands at $54.45. Coca-Cola declared a $0.42 per share quarterly dividend last week, and Morgan Stanley continues to have a positive view on KO shares.

Morgan Stanley has a positive view

Coca-Cola continues to improve its position in the market, and the board of directors declared a $0.42/quarterly share dividend last week, which will be payable on December 15.

Coca-Cola reported better than expected second-quarter results in July; total revenue has increased by 42% Y/Y to $10.1 billion, which was more than expected, while the GAAP EPS was $0.61 (beats by $0.05).

Through the second quarter, volume trends steadily improved each month, driven by the recovery in markets from the pandemic, and the company’s management expects another EPS beat in Q3.

Coca-Cola expects to deliver organic revenue growth for the 2021 fiscal year of 12% to 14% and comparable EPS growth of 13% to 15% compared with the previous year.

According to the latest news, Molson Coors has signed an exclusive agreement with Coca-Cola to manufacture, market, and distribute Topo Chico Hard Seltzer in Canada. The product is scheduled to launch in the summer of 2022, less than two years after the successful launch in the United States.

Topo Chico Hard Seltzer has garnered a 2.4% share of the U.S. market, and this deal will certainly help Coca-Cola to expand its revenue base further.

Last month, Coca-Cola introduced a new global brand platform called Real Magic with a new campaign, “One Coke Away From Each Other.” This is the first new global platform since 2016, and the company’s stability in a variety of market conditions has revealed its true staying power.

Morgan Stanley has a positive view on KO shares with a price target of $65, representing 20% upside potential. Dara Mohsenian, an analyst from Morgan Stanley, added:

The outlook for Coca-Cola remains positive; we see some headwinds from the recent increase in global COVID cases and slightly lower our FY21 topline forecasts, but remain above consensus in 22/23. We expect a return to outsized sales growth vs. peers post COVID, with improved execution and higher margins.

Technically looking, Coca-Cola shares could advance above the current price levels, but this company is not undervalued with a market capitalization of $234 billion. The book value per share is around $5, and Coca-Cola trades at more than seventeen times TTM EBITDA.

$60 represents strong resistance

Data source: tradingview.com

Coca-Cola shares have weakened from their recent highs above $57, and if the price falls below $50 support, the next target could be at $45. On the other side, if the price jumps above the strong resistance that stands at $60, the next target could be at $65 or even above.

Summary

Coca-Cola shares have weakened from their recent highs above $57, but Morgan Stanley continues to have a positive view on KO shares with a price target of $65. Coca-Cola continues to improve its position in the market, but this company is not undervalued with a market capitalization of $234 billion.

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