FedEx Corporation (FDX) | Daily Alert September 17
We look for growth to pick up in FY22 for FedEx and are maintaining our EPS forecast of $12.00. Our five-year earnings growth rate forecast is 8%.
We think that FDX shares are attractively valued at current prices near $220. On a technical basis, they had been in a bearish pattern of lower lows and lower highs since establishing an all-time high of $274 in January 2018, but the stock recently formed a double-bottom, and the trend since then has been higher.
FDX shares are trading at 18-times our FY22 EPS estimate, above the midpoint of the historical range of 9-21, though we note that margins are historically low and likely to rise. On a price/sales basis, the shares are trading at a multiple of 0.9, near the high end of the five-year range of 0.5-1.0. The yield of about 1.1% is below the midpoint of the five-year range.
We are raising our 12-month target to $250, or 21-times our FY22 EPS estimate, at the high end of the stock’s historical range as earnings recover.
Jim Kelleher, CFA, Argus Weekly Staff Report, argusresearch.com, 212-425-7500, September 10, 2020
Darden Restaurants, Inc. (DRI) | Daily Alert October 9
52wk H. 124.01 52wk L. 26.15
Mkt Cap:$13.11B, EPS: -0.43, Beta: 1.34
The restaurant chain is the owner of Olive Garden, Capital Grill and LongHorn Steakhouse, to name a few. DRI’s earnings report signaling improved recovery the basis for reinstating a dividend. Has been trading in death cross mode since March ’20 reversal rocketed its exits in recent sessions: (75-81) to (83-89) to (90-96) to high of 101. Volatile.
BUYING RANGE: 92-105
NR TERM OBJ: 121
INTERMED OBJ: 146
STOP LOSS: 83
Joseph Parnes, Shortex Market Letter, shortex.com, 800-877-6555, October 1, 2020