FedEx Earnings: A Sign of the Times

FedEx (FDX) is one of those "whole economy" stocks that let you know where we stand on several fronts, including measures like demand for deliveries and just how fuel costs are affecting major customers.

So listen up when the Memphis-based shipping giant slashes its guidance for 2009.

FedEx says things are looking worse thanks to the "significantly weaker" global economy. For fiscal '09, the company now expects to earn $3.50-$4.75 a share, down from a range of $4.75-$5.25. That's well below Wall Street consensus of $5.23 a share.

Falling fuel prices didn't help offset that pain much either. From the press release:

Second quarter results benefited from rapidly declining fuel prices and continued cost management,” said Alan B. Graf, Jr., executive vice president and chief financial officer. “However, demand for our services weakened sequentially throughout the quarter and global economic trends continue to worsen, substantially reducing our second half outlook. We are adjusting our expense plans to more closely align with the weaker business conditions, and are now targeting capital spending of $2.5 billion for fiscal 2009, down from $3.0 billion at the start of the year.

FedEx shares are down 11 percent after hours, and the news from its rivals doesn't look much better. In mid-November, DHL said it would halt domestic express U.S. shipping and cut 9,500 jobs.