FedEx Corp. (FDX) has been on a remarkable long-term uptrend since it went public in 1978. The company has seen steady growth throughout the years, and its stock has responded accordingly. However, there have been some red flags that have cropped up in the stock’s performance that might spell trouble for its long-term uptrend.
First, it’s important to look at the bigger picture when it comes to FDX. The stock has been performing well in recent years, with its price reaching all-time highs, and has seen a particularly impressive run since the start of 2020. This is largely due to the boost the pandemic has given to the company. However, the firm has been underperforming the market since mid-2019, to an extent that could indicate a major change in the long-term trend.
Second, the company is facing a huge decline in sales due to the impact of the pandemic. This has fed into weak earnings, with the company posting consecutive quarters of losses for the first time in 15 years. This is a worrying trend, and investors will no doubt be watching closely to see how the firm bounces back.
Third, the company’s debt situation has been a major issue and a potentially major drag on the stock’s performance. The company’s debt load has been steadily increasing for years and stands at more than three times the company’s market capitalization. High debt levels can lead to higher costs, stymied growth opportunities, and potential insolvency concerns.
Given these developments, there are clearly some major question marks surrounding FDX’s long-term uptrend. Investors will need to keep a close watch on the stock to see how it performs in the coming months and adjust their investment strategies appropriately. The firm has a long history of success, but it is essential to stay vigilant when it comes to managing long-term investments.