FedEx Corporation (FDX): Today's Featured Transportation Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

FedEx Corporation ( FDX) pushed the Transportation industry lower today making it today's featured Transportation laggard. The industry as a whole closed the day down 0.5%. By the end of trading, FedEx Corporation fell $2.73 (-3.1%) to $86.55 on heavy volume. Throughout the day, 6.4 million shares of FedEx Corporation exchanged hands as compared to its average daily volume of 1.9 million shares. The stock ranged in price between $86.36-$88.33 after having opened the day at $87.09 as compared to the previous trading day's close of $89.28. Other companies within the Transportation industry that declined today were: Frontline ( FRO), down 8.2%, Ultrapetrol Bahamas ( ULTR), down 7.3%, Knightsbridge Tankers ( VLCCF), down 6.6%, and Republic Airways Holdings ( RJET), down 5.9%.
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FedEx Corporation provides transportation, e-commerce, and business services in the United States and internationally. It operates in four segments: FedEx Express, FedEx Ground, FedEx Freight, and FedEx Services. FedEx Corporation has a market cap of $28.31 billion and is part of the services sector. The company has a P/E ratio of 14.1, equal to the average transportation industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Shares are up 6.9% year to date as of the close of trading on Monday. Currently there are 15 analysts that rate FedEx Corporation a buy, no analysts rate it a sell, and six rate it a hold.

TheStreet Ratings rates FedEx Corporation as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, good cash flow from operations and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the transportation industry could consider iShares Dow Jones Transportation ( IYT) while those bearish on the transportation industry could consider ProShares UltraShort Industrials ( SIJ).

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