FedEx slumps 15% amid weak demand for pricey priority deliveries
economictimes.indiatimes.comShares of FedEx slumped 15% on Friday, on track for their worst day in two years, after dismal first-quarter results, in what analysts attributed to a combination of broader economic concerns and an unfavorable shift in the company's sales from higher-priced deliveries.
FedEx, seen as a global trade barometer, is potentially losing nearly $11 billion in market value, and has also dragged down its rivals UPS and DHL shares, as the shipping industry deals with sluggish demand and bloated costs.
FedEx said on Thursday its profits were pressured due to waning demand for lucrative priority shipments between businesses, leading at least eight brokerages to cut their price targets on Friday.
BoFA Global Research made the heftiest cut, reducing its price target by $37 to $308.
«Weakness in the industrial economy pressured our B2B volumes, particularly in the US,» CEO Raj Subramaniam said.
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