Looking forward, the firm noted that “package volumes are solid this holiday season, and we see continued global economic growth in 2007″ (which logically means continued strong shipping volumes). On top of the anticipated gains in volume, FedEx will be raising rates on its services (and surcharges) at the end of this month. The hikes, in the low single-digit percentages, should do little to decrease demand for the firm’s services, but will almost certainly help it grow its profits faster than its sales.
But if the holiday volumes are so solid, why is the company sending out e-mails which have included four coupons for various services. Not the kind of thing a company does when they are booked solid.
FDX 1-yr chart:
Disclosure: Author holds FedEx put options.