Going Over FedEx’s 2021 Performance

FedEx (NYSE:FDX) has been a controversial stock as of late.

By the time 2021 went to a close, FedEx stock had dropped significantly. Nonetheless, UPS stock increased by 27% at the same time. Given that UPS is one of FedEx’s main competitors, this was alarming, to say the least.

If UPS can excel this much, then why FedEx couldn’t? Let’s go over the details and find out.

The Pandemic Has Tied FedEx’s Hands

It goes without saying that the pandemic gave online shopping a second life. And if online shopping thrives, it makes sense that package delivery would too. Well, that wasn’t the case for FedEx.|

Even if the pandemic has been going on for years, the company still struggles to keep up with its limitations. To give you a better picture, here are a few examples:

• FedEx has been unable to fully upgrade its warehouses to COVID-safe spaces. Limiting the number of employees that can occupy them at the same time.
• FedEx has been unable to cover elevated transportation costs. The same goes for elevated employee salaries.
• FedEx recently struggled with bad weather conditions, leading to various delays.

Sadly, that’s about it. There isn’t much to be said on the matter now. And to make matters worse, since the pandemic is still ongoing, it is to be expected that these issues remain for a long while. Not to mention, the holiday season is over, so do expect lesser demand for FedEx’s services.

Nowadays, Wall Street estimates that the company is trading less than 13 times their earnings estimates for 2022. 

Nonetheless, do remain cautious on the matter. The company is set to release its first report in early February. In the best-case scenario, we could see some news regarding any improvements.