New book by Larry Connors Click here Improve your trading - See how
The Seattle, Washington-based company's services include forwarding air and ocean freight, distribution management, vendor consolidating, providing cargo insurance, purchase order managing and offering customized logistics information. The company also offers breakbulk services that include receiving and breaking down consolidated airfreight lots and arranging for distribution of the individual shipments.
The company also acts as a customs broker and offers custom clearances for goods moving by rail and truck. Its customers include computer retailers, distributors of consumer electronics, department store chains, clothing and shoe wholesalers, manufacturers and catalogue stores.
When Expeditors reveals its report card for the quarter, on average, 15 analysts polled by Thomson Reuters expect earnings of $0.35 per share. Revenues are estimated to be $1.53 billion. For full year 2008, the company is estimated to earn $1.37 per share on revenues of $5.85 billion. Analysts' estimates typically exclude special items.
Expeditors has been reporting increasing earnings for the past several quarters. In November 2008, the company reported a 15% increase in third-quarter profit, helped by a double-digit growth in same store net revenues. The company earned $85.57 million or $0.39 per share in the third quarter of 2008, up from $74.32 million or $0.34 per share in the same quarter of 2007. Total revenues increased 11% to $1.56 billion from $1.41 billion in the prior-year quarter.
Due to the economic crisis, consumer spending has tightened, leading to a decline in business volume for companies. Many firms have put aggressive pricing in place to tackle the situation and have adopted cost-cutting measures such as job cuts and suspension of pay to retirement fund.
A point of view in favor of Expeditor is that since the company buys in huge quantity, it is able to bargain for better rates than its customers can on their own. The profit comes from the difference in payment given to the shipping companies and charged from the customers. Secondly, Asia has been the growth area for the company, which has operations in 58 countries. So the effect of the financial meltdown could be less severe on the company.
A conflicting view is that sluggish international air and ocean freight volumes could hurt the company in the near future. While downgrading Expeditors' shares to "Sell" from "Neutral", UBS said in December 2008 that weakness in key trade routes would make it hard for the company to meet Wall Street's 2009 earnings growth expectations. The firm felt that the trans-Pacific trade corridor has been weak for over a year, and the intra-Asia and Asia-to-Europe markets have also slowed and the slowdowns are expected to worsen until the middle of next year. However, on January 23, UBS upgraded the company's stock to "Neutral" from "Sell".
Among larger players in the industry, package delivery giant United Parcel Service, Inc. (UPS | Quote | Chart | News | PowerRating) last week reported a profit for the fourth quarter compared to a loss last year, which included a hefty charge related to a new pension plan. UPS said fourth-quarter earnings were $254 million or $0.25 per share, compared to a loss of $2.641 billion or $2.52 per share for the year-ago quarter. Revenue for the quarter dropped to $12.70 billion from $13.39 billion reported for the previous-year quarter. Looking ahead to 2009, the company said the year would be one of the most difficult in its history and would only provide outlook for the first quarter due to the prevailing economic uncertainty.
FedEx Corp. (FDX | Quote | Chart | News | PowerRating), another packaging giant, also is hurt by the recession. FedEx announced in December 2008 a marginal rise in its second-quarter profit, and stated that it is experiencing the worst economic conditions in its 35-year operating history. While net income rose 3%, revenue edged up 1% from the year-ago period.
EXPD closed Monday's regular trade at $30.44, down $0.11 or 0.36% from the previous close, on 3.69 million shares. For the past year, the stock moved in the range of $24.05-$49.92.
For comments and feedback: contact editorial@rttnews.com Copyright(c) 2009 RealTimeTraders.com, Inc. All Rights Reserved
More News:
Market Updates |
Stock Alerts |
All Trading News |
Stock Index
About TradingMarkets | Contact | Advertise | Careers | Link to Us | Site Map | Help | Terms & Conditions | Privacy Policy | Return Policy | Testimonials | Feedback
The Connors Group, Inc. ("Company") is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. The analysts and employees or affiliates of Company may hold positions in the stocks, currencies or industries discussed here. You understand and acknowledge that there is a very high degree of risk involved in trading securities and/or currencies. The Company, the authors, the publisher, and all affiliates of Company assume no responsibility or liability for your trading and investment results. Factual statements on the Company's website, or in its publications, are made as of the date stated and are subject to change without notice.
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results of any individual trader or trading system published by Company are not indicative of future returns by that trader or system, and are not indicative of future returns which be realized by you. In addition, the indicators, strategies, columns, articles and all other features of Company's products (collectively, the "Information") are provided for informational and educational purposes only and should not be construed as investment advice. Examples presented on Company's website are for educational purposes only. Such set-ups are not solicitations of any order to buy or sell. Accordingly, you should not rely solely on the Information in making any investment. Rather, you should use the Information only as a starting point for doing additional independent research in order to allow you to form your own opinion regarding investments. You should always check with your licensed financial advisor and tax advisor to determine the suitability of any investment.
HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING AND MAY NOT BE IMPACTED BY BROKERAGE AND OTHER SLIPPAGE FEES. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.
The Connors Group, Inc.
10 Exchange Place, Suite 1800
Jersey City, NJ 07302
© Copyright 2009 The Connors Group, Inc.
