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Stock to Watch This Week: FedEx

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Stock market news is again capturing investors’ attention as Wall Street traders are anxious about betting on growth stocks as yields are expected to grow during this week.

Yields increased once again on Friday after the announcement made by the U.S. President Joseph Biden regarding the eligibility for a vaccine. Namely, all adults would be able to take a vaccine by May 1st. Thus the U.S. economy gets even closer to full reopening. Moreover, the 10-year Treasury yield hit a peak of 1.642%—its best result in a year before decreasing just a little bit just a bit lower.

This rise also made the Dow Jones Industrial Average record a 4% gain for the week. The 30-component mega cap index ended Friday session at a height of 32,778 as traders gave their preference to value and cyclicals than growth stocks whose stretched valuations concerned investors as interest rates rose higher.

The NASDAQ, center of large tech shares, also added 3% last week, but it is down 5.5% over the last month. As these unstable market conditions take over, below we present a mega cap stock which is worth putting under your radar.

FedEx

The world’s biggest and perhaps the most popular parcel delivery service, FedEx (NYSE:FDX), is one more mega cap company that intends to share its fiscal 2021, third quarter earnings after the market closes on Thursday. Overall, market experts are looking for earnings per share of $3.35 on sales of $19.93 billion.

FedEx’s earnings report, that is being released much earlier, more than a month before the majority of U.S. companies, would be closely watched. The delivery company is thought to be a major representative for the health of the world economy. The recent announcements from the Memphis, Tennessee-based company demonstrate that its business is flourishing as it strives to accelerate pandemic-enhanced demand.

Nevertheless, FedEx’s stock has lost its strong sentiment since hitting its highest peak back in December, after the company explained that costs to ship packages are growing, crimping margins at its flagship ground unit. FedEx shares have added around 4% this year, ending trading at $270.29 on Friday after soaring to $305.66 in December 2020.

In general, traders turned bullish on courier companies as the pandemic continued which inspired customers to do more shopping online. However, in case there is a sign that e-commerce deliveries are losing profitability, their shares would be severely hurt.

 

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