Nike Stock Down 6%, FedEx Stock Surges 10% on Earnings
Today the FedEx stock opened with a massive bullish gap, while the Nike stock opened with a big bearish gap. We have more earnings reports coming out, which is keeping the main stock indices mixed, with the broader sentiment in the financial markets also being subdued.
FedEx Chart Daily – Stock Price Opened Above 2023 High
FedEx (FDX) stock is experiencing a rise today, following the company’s announcement of a third-quarter profit beat and the initiation of a $5 billion program that aims to buy back shares, in its most recent earnings report. This increases the demand for FedEx shares and reduces the number of them in circulation as well. Despite missing sales estimates, the shipping company outperformed on adjusted earnings per share (EPS) in its recent quarter. FedEx also reported rising express margins and reduced its full-year projection. Additionally, they’re seeking to renew its multi-year contract with UPS, which is seen as a positive development for the company’s future prospects.
FedEx has acknowledged that global trade weakness persists, leading to limited demand in its overseas operations. This challenge has persisted for a longer duration than initially projected. Despite the significant deterioration in full-year revenue projections over the past nine months, FedEx now anticipates that adjusted earnings will surpass the midpoint of the range disclosed in June.
Nike Daily Chart – Falling Below $100
On the other hand, Nike (NKE) shares are trading down today. Nike’s shares fell approximately 6% as Chinese sales continued to weaken during the lucrative holiday season. This decline in Nike’s stock price follows the release of the company’s quarterly results. Lululemon’s shares also fell in response to their quarterly results.
Overall, while FedEx’s positive earnings report and share repurchase program have contributed to the rise in its stock price, Nike’s weaker-than-expected performance in Chinese sales has led to a decline in its share price. Investors will continue to monitor both companies closely for further developments and their impacts on the stock market.
NIKE’s third-quarter performance showcased the operational discipline of its teams, achieving revenues that surpassed the double-digit growth of the previous year. The company exceeded expectations in North America, demonstrating resilience despite dynamic conditions in several other markets. Notably, NIKE delivered exceptional holiday sales in North America, with lower markdowns compared to competitors and unit growth exceeding the previous year.
While they anticipate weaker revenue in H2iof 2024, it expects overall revenue growth of approximately 1% for the entire year. Sales in Europe, the Middle East, and Africa fell short of expectations in the quarter due to increased macro volatility and weakening consumer demand. The company remains cautious about the economic conditions in international markets, particularly in Europe, the Middle East, and Africa, expecting limited improvement. In Greater China, third-quarter revenue increased by 6%, aligning with the updated expectations announced at the end of the previous quarter.
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