FedEx (FDX.US) shares fell over 1.5% on Tuesday after Citi downgraded the transportation company to neutral from buy and lowered its price target to $225 from $270, citing concerns over the pace of freight activity and pressures to earnings per share growth this year.
“Our call is focused on the potential for macro headwinds to challenge [earnings] growth this year, as the company’s self-help initiatives are more focused on [fiscal year 2024] and beyond,” Citi analyst Christian Wetherbee wrote in his research report.
Start investing today or test a free demo
Open account Try demo Download mobile app Download mobile appWetherbee believes that FedEx competitor United Parcel Service (UPS.US) has better ability to reduce costs and execute during times of economic uncertainty, and suggests a "pair trade," in which he recommends overweighting UPS's stock and underweighting FedEx shares.
FedEx (FDX.US) stock price broke below lower limit of the triangle formation and is currently testing local support zone at $203.65, which is marked with previous price reactions and 50.0% Fibonacci retracement of the upward wave launched in March 2020. Should break lower occur, price may be heading toward April low around $192.25. Source: xStation5
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.
