Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2: This is the closing bell on the stock Movers report
Speaker 2: the company's making moves at the close of US trading
Speaker 2: with Carol Masser, Tim Stenebeck, Romain Bostik, and Katie Greyfell.
Speaker 3: Let's get to some individual gainers. IBM a top gainer
Speaker 3: in the S and P five hundred today, that stock
Speaker 3: up about five percent in the Tuesday trade. JP Morgan
Speaker 3: upgrading it to overweight from neutral. Separately, the company announced
Speaker 3: has joined the Open AI Daybreak cyber Partner program. The
Speaker 3: analyst over at JP Morgan says the upgrade reflects greater
Speaker 3: confidence and software acceleration ahead. Price target set to two
Speaker 3: ninety one, the stock closing at two sixty four and change. IBM,
Speaker 3: by the way, has about sixteen by six holes and
Speaker 3: one cell rating among analyst tracked by Bloomberg. That press release,
Speaker 3: though after a close on Monday, that we also got
Speaker 3: from IBM, noted that this packed with open AI, would
Speaker 3: bring advanced AI capabilities into security operations to help enterprises
Speaker 3: counter machine speed threats. I don't know what that means,
Speaker 3: but let's go to some earnings.
Speaker 4: Crossing the Bloomberg.
Speaker 1: Terminal FedEx, the shipping company reporting earnings right now for
Speaker 1: the most recent quarter. This is their fiscal fourth quarter
Speaker 1: that just ended. It does look like a beat. Federal
Speaker 1: Express revenue up twenty one point five seven billion. That's
Speaker 1: a fourteen percent jump. That's just for the FedEx business.
Speaker 1: And I say that because they just spun off their
Speaker 1: freight business. If you include that freight business, A revenue
Speaker 1: was up thirteen percent to twenty five billion dollars. Operating
Speaker 1: margins expanded to eight point four percent. Operating income was
Speaker 1: also up about three point four percent. EPs also looked
Speaker 1: like it beat at six point three one. Now we
Speaker 1: should point out these fourth quarter numbers include the freight business,
Speaker 1: which has just been spun out. They're given a forecast
Speaker 1: for the full year that excludes the freight business, as
Speaker 1: you will. They're also moving from a fiscal year to
Speaker 1: the full calendar year reporting, so it gets a little tricky.
Speaker 1: Where they're saying for the full calendar year twenty twenty six,
Speaker 1: they expect to see adjusted EPs from continuing operations of
Speaker 1: sixteen dollars and ninety cents to share to eighteen dollars
Speaker 1: and ten cents a share. It's going to take us
Speaker 1: a while to get you a good comparison here on
Speaker 1: how that stacks up with analyst estimates here. But overall
Speaker 1: for the most recent quarter, it does look like a
Speaker 1: slight beat on several of the key metrics.
Speaker 3: Yeah, keep in mind FedEx on quite a tear this year,
Speaker 3: up about thirty six percent here to date. We are
Speaker 3: seeing the stock trend about one point six percent lower.
Speaker 3: Raj Supermamium, he is a FedEx president and CEO in
Speaker 3: the press release saying this a direct quote, are profitable
Speaker 3: growth strategy is working. We are building momentum across our
Speaker 3: global industrial network, driving structural improvements and winning in high
Speaker 3: value growth markets. With the successful spin off of FedEx Freight,
Speaker 3: we are entering this next chapter position to grow while
Speaker 3: further optimizing our network, lowering our cost to serve, creating
Speaker 3: meaningful long term value, and driving robust free cash flow.
Speaker 3: So some optimism there, and just to kind.
Speaker 1: Of put a point a sorry, Jim, I just want
Speaker 1: to put a point on that too, what Carol was
Speaker 1: talking about, because this is a company that's really pivoted
Speaker 1: towards higher margin businesses, getting rid of some of that
Speaker 1: those lower margin of packages that you or I would
Speaker 1: get on our doorstep, focusing a lot more on the bTB,
Speaker 1: and you saw that with a huge jump in revenue.
Speaker 1: It was like ten percent just on the FedEx side,
Speaker 1: but if you look at actual volumes that was only
Speaker 1: up two percent. So you had a huge gap there
Speaker 1: between the actual revenue side and the volume side, which
Speaker 1: seems to suggests if you're reading between the lines a
Speaker 1: little bit more pricing power.
Speaker 4: Well, the company actually addressing this, Romaine, I'm glad you
Speaker 4: went there. The company cited improved improved segment operating results
Speaker 4: driven by higher US domestic international priority package yields, talking
Speaker 4: about continued cost savings from those transformation initiatives that you
Speaker 4: reference Romaine increase US domestic and international export package volume. However,
Speaker 4: those factors were partially offset by increased purchase, transportation and
Speaker 4: wage rates, higher variable incentive compensation expenses, and the financial
Speaker 4: impacts of global trade policy changes. So some of those
Speaker 4: macro and micro factors affecting the bottom line.
Speaker 3: Two.
Speaker 5: And FedEx is seen as this economic barometer because it's
Speaker 5: parcel business. Really just carries this huge array of stuff
Speaker 5: for all kinds of consumers and all kinds of places.
Speaker 5: But I wonder if after the spinoff they will still
Speaker 5: be looked at upon as an economic barometer, especially after
Speaker 5: I mean, to be Romaine's point earlier, it's going to
Speaker 5: take a while for us to compare it to something.
Speaker 3: Hey, here's something that's interesting too. Under Cash and capital Returns,
Speaker 3: they talked about cash and cash equivalents balance of about
Speaker 3: thirteen point three billion, including a four point one billion
Speaker 3: dollar cash dividend from the FedEx Freight spinoff, But it
Speaker 3: also says, in addition, the reported cash balance includes approximately
Speaker 3: eight hundred million dollars in IIPA TI free funds held
Speaker 3: for refund to customers, so that process is certainly happening.
Speaker 1: Yeah, a few of those dollars I think belong to me.
Speaker 4: So way, how are you going to get those?
Speaker 1: Because I think I don't know, I have no idea
Speaker 1: how any of this works. But let's just say, yeah,
Speaker 1: AYIPA got a lot.
Speaker 3: It'll be in your Venmo account. I think that's how
Speaker 3: it's going to work.
Speaker 1: I do just want to point out too real quickly.
Speaker 1: We are going to hear from FedEx Freight. They report
Speaker 1: after the bell on Thursday the twenty fifth, just to
Speaker 1: be clear, so we'll get a sense here how that
Speaker 1: side of the business is holding up as a standalone company.
Speaker 3: Okay, let's go back to some other gainers. I mentioned IBM,
Speaker 3: so I'm going to move on from that. I should
Speaker 3: point out the whole quantum area too. President Trump has
Speaker 3: been keen on that too, made some comments and some
Speaker 3: executive orders signed. Yesterday. You also had IBM's CEO there
Speaker 3: and Alphabet President Ruthportt there at the White House, still.
Speaker 1: Getting interested in this. And when I first started hearing
Speaker 1: all the quantum stuff, I just thought this was a
Speaker 1: gobbling book. But the more I like I read about it,
Speaker 1: it seems like there is a little bit more proof
Speaker 1: of life there. I don't know when it actually translates
Speaker 1: into real revenue and profitability, but it does appear there's
Speaker 1: a lot going on there.
Speaker 3: I mean, we're still kind of making our way through AI, Like,
Speaker 3: where does it fit into all of this?
Speaker 1: Yeah, well, it's just kind of an extension of that.
Speaker 1: And I actually had a chance to interview our the
Speaker 1: CEO just a couple of weeks ago, and he basically
Speaker 1: said that some of his sort of proof of life
Speaker 1: targets the idea that IBM hardware would be used to
Speaker 1: hit some of those key targets in quantum that we
Speaker 1: would actually see that in twenty twenty six by the
Speaker 1: end of the year.
Speaker 3: All right, all right, so we're keeping an eye on that.
Speaker 3: Some interesting stuff. I agree, there's a lot more activity
Speaker 3: going back to Avis budget though, this one up about two.
Speaker 2: No.
Speaker 1: This is weird because it's like one of those days
Speaker 1: where I feel like Tim should start and do all
Speaker 1: the decliners, given that, you know, three percent down day
Speaker 1: in the next Andre, this.
Speaker 3: Is your clothes. Whatever you want to do.
Speaker 4: Yeah, No, KEI Isabelle and I just like watching this.
Speaker 1: Keep going, keep going. That's what we will show Finley.
Speaker 3: What should I do?
Speaker 2: What should I do?
Speaker 5: Okay?
Speaker 3: Avis two point two percent hired in today's session. They
Speaker 3: were up as much as almost six percent intra day high.
Speaker 3: Earlier in the day, Avis entered into a settlement agreement
Speaker 3: with Pentwater Capital Management and affiliated persons to resolve a
Speaker 3: lawsuit seeking recovery of short swing profits. The company says
Speaker 3: this in a filing. Keep in mind the stock is
Speaker 3: up about fifty percent year to date. Thirty two percent
Speaker 3: though of the float is short and one more for you.
Speaker 3: It's not something we talk about tickers EPC Edge Well
Speaker 3: Personal that stock up about fifteen percent after Bloomberg News
Speaker 3: reported the make Care of Ship Raisers rejected rejected an
Speaker 3: unsolicited takeover offer of thirty dollars a share from pe
Speaker 3: firm Yellowood Partners. Okay him, all.
Speaker 4: Yours, all right, Let's talk about some of these decliners
Speaker 4: very quickly. There were so many stocks in the chip
Speaker 4: in the chip sector that declina just did. The entire index.
Speaker 4: All thirty names in the socks fell today down seven
Speaker 4: point nine percent. Let's round that up to eight percent.
Speaker 4: It's still up ninety percent this year, though, but that
Speaker 4: the slump today followed what we saw in Asia overnight,
Speaker 4: with Samsung and sk hi Nix plunging more than ten percent.
Speaker 4: This is the one I really want to talk about, though, guys.
Speaker 4: Robinhood and DraftKings both fell today. This after The New
Speaker 4: York Times reported that Meta Platform CEO Mark Zuckerberg directed
Speaker 4: a small team to create a smartphone app similar to
Speaker 4: similar to call She and Polymarket. You had Robinhood fall
Speaker 4: by two point three percent, DraftKings fall by two percent.
Speaker 4: Here's the thing, though, this app will probably use a
Speaker 4: video game like points system, and it would not wager
Speaker 4: any money. Does this actually produce results that are accurate
Speaker 4: with predicting the future if you don't have any actual
Speaker 4: skin in the game.
Speaker 2: Stockmover's report from Bloomberg Radio. Check back with us throughout
Speaker 2: the day for the latest roundup of companies making news
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