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The Latest FedEx Headlines
Not All's Fine at FedEx
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<blockquote data-quote="cheryl" data-source="post: 852091" data-attributes="member: 1"><p><strong>Not All's Fine at FedEx - Motley Fool</strong></p><p><a href="http://www.fool.com/investing/general/2011/06/23/not-alls-fine-at-fedex.aspx" target="_blank">http://www.fool.com/investing/general/2011/06/23/not-alls-fine-at-fedex.aspx</a></p><p>So FedEx (NYSE: FDX ) beat earnings. Big deal.</p><p></p><p>Call me a skeptic, call me a Fool, but no matter how good the headlines read, when I get a copy of FedEx's earnings in hand, I always head straight to the cash flow statement to see how the business is really doing. Sadly, the news here is not good. Despite reporting $1.45 billion in profit last year, FedEx showed a mere $607 million in actual free cash flow generated for the period. At today's prices, therefore, a share of FedEx will set you back about 48 years' worth of actual cash profit -- and it gets worse.</p><p></p><p>Last year, FedEx laid out $3.4 billion on capital expenditures (the bulk of which went to "aircraft and related equipment"). This year, management promises to spend $4.2 billion on capital expenditures -- a 24% increase. Boeing (NYSE: BA ) will probably applaud the extra spending on airplanes. I do not.</p></blockquote><p></p>
[QUOTE="cheryl, post: 852091, member: 1"] [B]Not All's Fine at FedEx - Motley Fool[/B] [URL='http://www.fool.com/investing/general/2011/06/23/not-alls-fine-at-fedex.aspx'][B][/B][/URL] So FedEx (NYSE: FDX ) beat earnings. Big deal. Call me a skeptic, call me a Fool, but no matter how good the headlines read, when I get a copy of FedEx's earnings in hand, I always head straight to the cash flow statement to see how the business is really doing. Sadly, the news here is not good. Despite reporting $1.45 billion in profit last year, FedEx showed a mere $607 million in actual free cash flow generated for the period. At today's prices, therefore, a share of FedEx will set you back about 48 years' worth of actual cash profit -- and it gets worse. Last year, FedEx laid out $3.4 billion on capital expenditures (the bulk of which went to "aircraft and related equipment"). This year, management promises to spend $4.2 billion on capital expenditures -- a 24% increase. Boeing (NYSE: BA ) will probably applaud the extra spending on airplanes. I do not. [/QUOTE]
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