FedEx (FDX-N)

They report Wednesday. He worries that even the best quarter won't send shares higher, and even decline, given high expectations. He expects a great quarter with beats. They took market share from UPS after fears of a UPS strike, but this seems like a one-time occurrence.

Are enjoying a good 2023 as they cut costs, but they are recapturing the losses of 2022. UPS is better for managing their balance sheet.

Exited, as he wasn't completely comfortable with management. Curveball from management last September made him lose confidence.

Revenues missed, but EPS beat. Mixed. Shares are up 31% YTD and trades at 31x PE. Guidance wasn't great. An activist is focusing on continuing cost cuts and increasing productivity. He's still in this and evaluating this into the next quarter. It's been a winner for him but is considering taking some shares off the table.

They report Tuesday. He expects a solid report. Shares are up 36% YTD. The activist investor there is really focusing on efficiency and shareholder value. They raised the dividend 53% in the last quarter and had a strong investor day. He likes management and is confident they will successfully integrate their various businesses.

Cheap now. It's need another great quarter. Buy!

Market likes its new focus on cost cuts. Closed valuation gap with UPS pretty dramatically. At risk in a slowing economy, which they have bridged with a low valuation and a lot of cost-cutting.

A bellwether for the wider economy and what a comeback story. Shares are up 62% from last September's lows. Today, they announced it will consolidate its three major operations (Ground, Express and Services) into one which will save $4 billion. Also, FedEx raised its dividend by 10%. Huge news.

Owns UPS instead, and it's good that FedEx that both are focusing on profitability. She prefers UPS for having more density in its ground business and more tied to e-commerce which will remain strong. UPS is exposed to Amazon, which some feel is a risk, but she doesn't anymore, because Amazon can't invest more in infrastructure anymore.

How long can both keep cutting jobs until they can't cut anymore? FedEx retained pricing power with ground revenues up 7%. Interesting. How long can they maintain this edge as we enter a recession?

They report next Thursday. Until today's mass sell-off FedEx appeared unstoppable. Investors pulled out of cyclicals, expecting Powell to keep tightening no matter what.

It's struggled in past years, but he's a long-term investor (6 years on average). They have rebounded along with the economy and the supply chain has eased. Good management name and will reap benefits of capital equipment investments .