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FedEx Q3 Results Miss Wall Street View; Shares Down 5%

Shares of FedEx Corp. (FDX) slipped 5% on extended trading session on Tuesday after the package delivery giant's results for the third-quarter fell short of estimates. The company also lowered its full year 2019 outlook.

Memphis, Tennessee-based FedEx's third-quarter profit dropped to $739 million or $2.80 per share from $2.07 billion or $7.59 per share last year.

Last year's results included benefit of an estimated $1.15 billion reduction in the company's net U.S. deferred tax liability due to the lower statutory rate enacted as part of the tax reforms.

Adjusted earnings for the quarter were $3.03 per share, down from $3.72 per share last year. On average, 22 analysts polled by Thomson Reuters expected earnings of $3.11 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter rose to $17.0 billion from $16.5 billion last year. Wall Street analysts had a consensus estimate of $17.67 billion.

"Our third quarter financial results were below our expectations and we are focused on initiatives to improve our performance," said CEO Frederick Smith. "Our investments in innovation, network infrastructure and automation will increase our competitiveness and drive long-term earnings growth."

Being global transportation companies, the performance of shipping giants like FedEx and its rival United Parcel Service Inc. (UPS) are considered a strong barometer of overall consumer attitude and economy.

Looking forward to the full year 2019, the company now expects adjusted earnings to be $15.10 to $15.90 per share, down from prior forecast of $15.50 to $16.60 per share. Analysts currently estimate earnings of $15.97 per share.

FDX closed Tuesday's trading at $181.41, down $0.99 or 0.54%, on the NYSE. The stock further slipped $9.41 or 5.19% in the after-hours trade.

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