Piper Jaffray Reports Greater Conviction In FedEx's F2010 Earnings

In a report published by Piper Jaffray, it has greater conviction in FedEx's FDX F2010 earnings upside potential post F3Q11 results.

Piper Jaffray said that yesterday before the market FDX reported F3Q11 (ending Feb) continuing EPS of $0.81 – in the middle of the company's 2/14/11 downside pre-report range. “Most meaningful from yesterday's report – aside from mgmt seeing no derailment to global economic recovery – was (1) F4Q11 EPS guidance of $1.66-$1.83 with the midpoint 1% above prior implicit guidance and (2) Freight (LTL)'s network consolidation going surprisingly smoothly in a very difficult weather quarter and expectations for operating profit in F4Q11 which removes some overhang/risk. F2012 is setting itself up to be an exceptional year of earnings growth potential and we believe FDX is closer to entering a sustainable period of now beating expectations versus making/missing. We reiterate our Overweight rating.”

FedEx closed yesterday at $87.89.