| The Opel Lesson: Creative Destruction Still Not Popular in Germany Global Investing Editor submits:Amidst the festivities last weekend over the fall of the Berlin Wall (on what Germans call 9/11, in 1989), there were a few sour notes. Grumbles against heartless capitalism, globalization, and non-German governments, particularly the Obama Administration, were audible from the Left Party, trades unions, and grumbly Berliners.The complaints came over the unraveling of the complex joint venture whereby Magna of Canada (MGA), a Russian automaker, and the German State would take over Adam Opel AG, the German car-maker. Last week, the board of Opel's owner, General Motors, flush with $50 bn in US subsidies, vetoed the arrangement.Complete Story » seekingalpha.com |
Twin Disc Incorporated F2Q10 (Qtr End 12/25/09) Earnings Call Transcript Twin Disc Incorporated (TWIN)F2Q10 Earnings CallJanuary 21, 2010 2:00 pm ETComplete Story » seekingalpha.com |
Continental Airlines Q1 2010 Earnings Call Transcript Continental Airlines (CAL) Q1 2010 Earnings CallApril 22, 2010 10:30 AM ESTComplete Story » seekingalpha.com |
FedEx: Earnings Scorecard Zacks.com submits: FedEx Corporation (FDX), a global leader of transportation, e-commerce, and supply chain management services, reported fourth-quarter 2010 results on June 16, 2010. FedEx earnings were in line with the Zacks Consensus Estimate of $1.33 and up from the year-ago quarter. However, the company’s first quarter and fiscal year 2011 outlook was disappointing. Fourth Quarter Review The company’s adjusted earnings of $1.33 per share were above the year-ago quarter of 64 cents per share. Growth in international Express shipment as well as FedEx Ground segment, which was partially offset by several cost expenses and an operating loss at FedEx Freight led to stronger earnings in the reported quarter. Total revenue increased 20% year over year to $9.43 billion. The strong exports from Asia drove revenue in the FedEx Express segment. Package volume growth at FedEx Ground as well as FedEx SmartPost volume growth spurred FedEx’s Ground revenue. FedEx Freight revenue spiked 30% year over year, reflecting higher average daily less-than-truckload (LTL) shipments partially offset by lower yields. FedEx Freight is still operating at a loss.Financial Outlook FedEx projects earnings in the range of 85 cents to $1.05 per share for the first quarter of 2011. The mid-point of 95 cents per share is well below the current Zacks Consensus Estimate of $1.00 per share. FedEx estimates earnings per share within $4.40 – $5.00 for fiscal 2011. The mid-point of $4.70 is also below the current Zacks Consensus Estimate of $4.98. Agreement of Analysts The overall trend noticed in the last 30 days, suggests the analysts’ concern about the stock as they appear more inclined towards the negative side of the estimate revisions for the upcoming quarter and fiscal year. Out of 17 analysts covering the stock, 6 made downward revisions for the first quarter of 2011 and 12 analysts out of 20 made downward revisions for fiscal 2011. Upward revisions were made by 3 and 5 analysts for the first quarter and fiscal 2011, respectively. For fiscal 2012, four analysts increased their estimates on FedEx while two analysts lowered the same. The earnings growth for fiscal 2011 will be restricted due to higher pension costs, increased aircraft maintenance expense, higher healthcare costs and resumption of certain 401(k) employee compensation programs. The company invests largely in aircraft and plans to increase its investment in fuel efficient Boeing 777 freighter, thereby raising the expenditure on aircraft. However, this investment will provide FedEx an edge over its competitors. Moreover, volatile fuel prices may also keep earnings under pressure. The analysts are also pessimistic about a recovery in global trade, uncertainties in the Europe, and looming debt problems. Further, the FedEx Freight segment, which is continuously posting losses, is a major risk for the company. Over the last 7 days, there has been no clear directional movement with 1 analyst out of 20 covering the stock, revising the estimate upward and 1 revising it downward for fiscal 2011. For fiscal 2012, one analyst out of 15 made an upward revision while none of the analysts lowered the estimate. Magnitude – Consensus Estimate Trend Fourth-quarter results are in line with the Zacks Consensus Estimate, suggesting no changes in the Zacks Consensus Estimates going forward. However, over the last 30 days, the Zacks Consensus Estimate reduced by 4 cents and 11 cents for the first quarter and fiscal 2011, respectively. The Zacks Consensus Estimate for fiscal 2012 was raised by 2 cents to $6.11. Earning Surprises With respect to earnings surprises, the company’s fairly good track record is expected to persist in the coming quarters. FedEx produced an impressive average earnings surprise of 4.2% over the last four quarters, which suggest that it beats the Zacks Consensus Estimate by that amount over the last year. The company just met the Zacks Consensus Estimate in the current quarter but has been beaten by 5.6% in the last quarter. Our Analysis Considering the in line fourth-quarter results and a negative bias in earnings growth for fiscal 2011, we are currently maintaining our Neutral recommendation with the Zacks Rank of #3 (Hold). Though the company has suffered from the economic recession over the last couple of years, improving global economy, resumption of industrial production growth, and increase in trade in international shipping is expected to fuel growth. However, reinstatement of employees’ compensation program and increased pension expense will dampen near-term earnings growth. The company’s Freight segment continues to suffer as trucks are competing for relatively smaller shipments, which is preventing it from raising its prices. However, FedEx is making an effort to turn its Freight segment into a profitable one. Currently, the Ground segment generates highest profits among all its business segments. FedEx has long-term growth prospects in its businesses in Asia and Europe. Emerging countries such as India also provides opportunities for growth. International shipments are driving higher profits than the domestic packages. FedEx has benefited from the exit of its key competitor DHL and has gained half of the latter’s total market share in domestic shipments.Complete Story » seekingalpha.com |
Earnings Preview: Boeing theflyonthewall.com submits: Boeing (BA) is expected to report Q3 earnings on Wednesday, October 20 before the market open with a conference call scheduled for 10:30 am ET. GuidanceAnalysts are looking for EPS of $1.05 on revenue of $16.72B. The consensus range is 91c-$1.21 for EPS, and $16.09B-$17.25B for revenue, according to First Call. The company reported mixed earnings in Q2, beating EPS estimates but missing revenue numbers. On its Q2 conference call, Boeing said it expects higher revenue in 2011 than 2010, and reaffirmed FY10 EPS estimates. It also said it saw improving fundamentals for airlines. Despite several reports that the Pentagon aims to severely cut its budget going forward, Boeing’s shares have advanced nearly 17% since August. Complete Story » seekingalpha.com |