FedEx warns about the economy worsening




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Last Week’s Highlights

FedEx warns about the economy worsening

FedEx Corp. presented three months ago its financial forecasts; now, the company warns the public about the worsening of the world economy and lowers its expectations. The courier company assured that the slowdown in global demand increased at the end of August and that the outlook is going to worsen for the November quarter. Its shares plunged more than 16%, as it also added that the company’s first-quarter earnings fell short of Wall Street’s expectations. FedEx had a shortfall in FedEx Express revenue of $500 million and FedEx Ground revenue of $300 million in the quarter.

Disney’s D23 event disappoints

Disney organized the D23 event where it announced the calendar of upcoming releases. The event was not what the entertainment company had hoped for as its stock declined. The news that most affected fans and investors was that the release of the “Star Wars” spin-off movie “Rogue Squadron” was removed from the schedule. Different releases related to this saga were still announced, however, it was not what the public was expecting. Over the last 12 months, Disney’s stock has been on a downward trend. A year ago, they were just above $183. Over time, its price was below $100 per share. Currently, the stock sits above $108. Despite all the negativity, for some analysts, buying Disney stock is attractive. The company trades right off its lows for the year and well below its lower price targets. This makes its upside potential very positive.

Coming Up This Week

Bed Bath & Beyond’s turnover strategy

Bed Bath & Beyond has a plan of cost reduction strategies and a change of direction of the company, so it published a list of 56 stores that it intends to close by the end of the year. The stores are spread across different locations in the United States such as California, New York, Ohio, Florida, and Texas, among others. In addition to the closures, the company is also laying off about 20% of staff to curb expenses amid falling sales. Bed Bath & Beyond expects to issue up to 12 million additional shares to help pay its outstanding obligations. Analysts are bearish on the company’s stock, rating it a “strong sell,” as year-to-date, the price per share has lost 42%.

The Twitter-Musk drama continues

The drama in the Elon Musk-Twitter deal saga continues to take its twists and turns. At some point during last week, Twitter was one of the only S&P 500 stocks in the green, up more than 2%, while the index was down 3.2%. The explanation is that Twitter shareholders voted in favor of selling the company to Elon Musk for $44 billion because if the sale goes through, there is tremendous upside potential for its stock. However, Elon Musk claims there are safety concerns and uses Peter Zatko’s testimony to weasel out of the deal. Musk pointed out that the company engaged in misconduct and wants to go through with the deal. There will be a trial next month to decide whether or not the deal will go forward.

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July 8, 2024

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