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Third Qtr. Earnings Down, Prepare To Pay
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<blockquote data-quote="FedEx2000" data-source="post: 809228" data-attributes="member: 13621"><p>I agree with bbsam, I think the Union factor is mostly to blame. Investors don't like the risk it entails and are still gun-shy of mostly Union companies due to the failures of GM, Chrysler, etc......regardless of the fact of whether the unions were to blame or not. In addition to that, I think they are looking at our expansion in China/India and what that will mean down the road as far as growth. Part of our earnings appearing to be low is the amount of capital expenditures we have, FedEx's capital expenditures are 14.33% vs. 1.61% for UPS. We are spending a lot of money on planes, facilities, expanding into growing markets, etc. Not to say UPS isn't, but we are spending a much larger % of our money doing so, which hopefully bodes well for us in the years to come as the global market stabilizes and grows.</p><p></p><p>Here's a link with more info also:</p><p><a href="http://www.bloomberg.com/news/2011-02-14/fedex-lowers-third-quarter-earnings-forecast-on-storms-higher-fuel-prices.html?cmpid=msnmoney" target="_blank">http://www.bloomberg.com/news/2011-02-14/fedex-lowers-third-quarter-earnings-forecast-on-storms-higher-fuel-prices.html?cmpid=msnmoney</a></p></blockquote><p></p>
[QUOTE="FedEx2000, post: 809228, member: 13621"] I agree with bbsam, I think the Union factor is mostly to blame. Investors don't like the risk it entails and are still gun-shy of mostly Union companies due to the failures of GM, Chrysler, etc......regardless of the fact of whether the unions were to blame or not. In addition to that, I think they are looking at our expansion in China/India and what that will mean down the road as far as growth. Part of our earnings appearing to be low is the amount of capital expenditures we have, FedEx's capital expenditures are 14.33% vs. 1.61% for UPS. We are spending a lot of money on planes, facilities, expanding into growing markets, etc. Not to say UPS isn't, but we are spending a much larger % of our money doing so, which hopefully bodes well for us in the years to come as the global market stabilizes and grows. Here's a link with more info also: [url]http://www.bloomberg.com/news/2011-02-14/fedex-lowers-third-quarter-earnings-forecast-on-storms-higher-fuel-prices.html?cmpid=msnmoney[/url] [/QUOTE]
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