FedEx signals recovery, but this post-merger SPAC pushed the stock market down on Friday
The stock Exchange continued to be agitated on Friday as investors attempted to analyze all the news influencing financial markets at this time. Most troubling for many has been the continued rise in yields on Treasury bonds, with the 10-year Treasury approaching 1.75%. This rate is not very high, but it is well above the Fed’s short-term target rate, and it reflects growing fears about future inflation. These worries sent the Dow Jones Industrial Average (DJINDICES: ^ DJI) down 221 points to 32,641 by 10:30 a.m. EDT. The S&P 500 (SNPINDEX: ^ GSPC) fell 14 points to 3,902, while the Nasdaq Composite (NASDAQ INDEX: ^ IXIC) managed to gain some ground by gaining 16 points to 13,132.
Profits continued to boost sentiment on Wall Street, and each quarter, FedEx‘s (NYSE: FDX) ratio is considered an indicator of economic activity. Meanwhile, a post-merger SPAC seeking to build an e-health giant fell out of favor on Friday morning.
FedEx shares rose nearly 5% on Friday morning, after rising even earlier in the session. The shipping company was able to deliver fiscal third quarter financial results that impressed shareholders.
FedEx numbers looked solid. Revenue of $ 21.5 billion was up from $ 17.5 billion a year ago. Adjusted earnings were $ 3.47 per share, which compares quite favorably with the adjusted earnings of $ 1.41 per share for the third quarter of fiscal 2020. Strong volume growth comes from domestic residential packages. electronic commerce as well as international priority services. FedEx also affirmed its pricing power by remaining firm on its prices.
In particular, FedEx’s strong performance came despite serious challenges. Winter conditions were severe over the period, weighing slightly on operating results. In particular, the FedEx hub in North Texas took the brunt of the cold snap that caused so much hardship statewide.
FedEx expects continued strength for the remainder of the year, including adjusted earnings of between $ 17.60 and $ 18.20 per share. With high hopes for another recovery, FedEx shareholders were in a festive mood over the report.
A little less healthy
Elsewhere, shares of Health for him and for her (NYSE: HIMS) was down 7%. The company recently completed its merger with an ad hoc acquisition company to go public, but investors weren’t entirely happy with what he had to say in his inaugural financial report.
Considering the growth in numbers at Hims & Hers, it was somewhat surprising to see the stock drop. Fourth quarter sales increased 67% year-on-year. Revenue jumped 80% for the full year of 2020 and gross margin figures jumped 20 percentage points to 74%.
Still, some of the news was not as good. CEO Andrew Dudum pointed to the high advertising costs which have forced Hims & Hers to manage costs carefully. This may have weighed on sales growth over the holiday season as the number of new orders in the fourth quarter slowed from the pace set three months earlier. In addition, operating losses have widened compared to previous quarters and Hims & Hers remains far from achieving profitability.
Hims & Hers is optimistic about the possibility of moving from an online treatment of health and wellness products to a full-fledged telehealth platform with wide application in healthcare. It’s an ambitious company, and at least on Friday, shareholders seemed unconvinced the company would meet its long-term goals.
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