Shares of FedEx Corp. (FDX) rallied 1.3% in afternoon trading Friday, after Cowen analyst Helane Becker boosted her price target by 58% ahead of the package delivery giant's earnings report, saying she sees "no reason positive trends should end" in the near term. She lifted her target to $264, which is 16% above current levels, from $167, while reiterated the outperform rating she's had on the stock for at least the past three years. FedEx is scheduled to report fiscal first-quarter results on Sept. 15, after the closing bell. Becker expects the results to show that the company is benefiting from positive e-commerce trends, which is driving up volumes and revenue, and from the favorable repricing of contracts resulting from tight industry capacity. "Admittedly, FedEx valuation is currently near peak levels, but the market is attempting to digest the permanent shift to e-commerce volumes, which has caused the recent increase in the multiple," Becker wrote in a note to clients. "The market continues to pay for growth (e-commerce) even if it is at the expense of margins." The stock has soared 50.4% year to date, while shares of rival United Parcel Service Inc. (UPS) have advanced 35.0% and the Dow Jones Industrial Average has slipped 3.7%.
-Tomi Kilgore; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
September 11, 2020 14:02 ET (18:02 GMT)
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