Not All's Fine at FedEx

Discussion in 'The Latest FedEx Headlines' started by cheryl, Jun 24, 2011.

  1. cheryl

    cheryl I started this. Staff Member

    Not All's Fine at FedEx - Motley Fool

    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.
  2. whenIgetthere

    whenIgetthere Well-Known Member

    Of course trucks and planes are falling apart. You have to spend it to make it, unfortunately investors don't give a damn!!