FedEx Sinks as Analysts See Warning in Executive's Exit - Yahoo
FedEx Corp. tumbled to the lowest in 18 months after Bank of America Corp. said a surprise executive departure from the courier’s air-freight division signaled a key financial goal is at risk.
Bank of America analyst Ken Hoexter cut his recommendation on FedEx to neutral and lowered his price target 28 percent after the resignation of David Cunningham as head of FedEx’s Express unit. Hoexter also cited a “decelerating global economy” as he estimated that the division would miss its target of boosting profit by more than $1 billion by 2020.
Cunningham’s departure after a tenure of just two years “could signal a reduction or delay in its profit improvement target,” Hoexter said Monday in a note to clients. “This is a rapid and, in our view, out-of-character change for a company that is still operated by its founder, chairman and CEO Fred S.”
FedEx Corp. tumbled to the lowest in 18 months after Bank of America Corp. said a surprise executive departure from the courier’s air-freight division signaled a key financial goal is at risk.
Bank of America analyst Ken Hoexter cut his recommendation on FedEx to neutral and lowered his price target 28 percent after the resignation of David Cunningham as head of FedEx’s Express unit. Hoexter also cited a “decelerating global economy” as he estimated that the division would miss its target of boosting profit by more than $1 billion by 2020.
Cunningham’s departure after a tenure of just two years “could signal a reduction or delay in its profit improvement target,” Hoexter said Monday in a note to clients. “This is a rapid and, in our view, out-of-character change for a company that is still operated by its founder, chairman and CEO Fred S.”
