FedEx Freight forecasts growth as standalone company

Insight summary

• •FedEx Freight reported Q4 revenue of $2.4 billion, a 4.8% increase driven by higher fuel surcharges and shipment weight.
• •For the next seven months, FedEx Freight forecasts adjusted EPS of $2.40 to $2.60 and revenue growth of 4% to 6%.
• •The operating margin for the forecast period is expected to improve to 9%-9.5%, up from 7.8%.
• •Q4 operating income fell 24% year-over-year to $363 million due to separation costs and lower shipment volumes.
• •Average daily shipments decreased by 5.9% to 86,700, while weight per shipment increased by 3%.
• •FedEx Freight holds a 17% share of the U.S. less-than-truckload market with 355 service centers and about 30,000 vehicles.
• •FedEx Corp plans to reduce $4.1 billion in debt with cash from FedEx Freight after the spin-off.