FedEx news update: Shares Rise in Light of Billionaire Investor

FedEx Shares Increase

FedEx news update: Shares of the logistics company rose as much as 8% at the beginning of July following a speculation that William Ackman would be investing.

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“Ackman wrote to clients Monday asking them to commit $1 billion to two new funds by the end of next week to invest in a major U.S. company that he did not name.

“The increasing volume in shares and options is being attributed to talk that activist investor Bill Ackman’s Pershing Square might be taking a stake in FedEx,” said options strategist Frederic Ruffy.

Ackman said the large-cap company he had in mind was engaged in a simple and predictable business that had high barriers to entry. Its stock traded at a lower earnings multiple than its most comparable competitor, he added.

Market speculation centered on FedEx as the company that best fit that description.

FedEx shares trade at 13.9 times forward 12-month earnings estimates of the most accurate analysts, according to Thomson Reuters StarMine. Shares of larger rival United Parcel Service trade at 16.6 times.

FedEx spokesman Jess Bunn said the company had no comment. A spokeswoman for Ackman was not immediately available.

“We agree that the [FedEx] valuations are attractive, but we’re not convinced that there is an opportunity for an activist investor to [be a catalyst for] a big operational improvement at FedEx like there was at Canadian Pacific,” Morningstar analyst Keith Schoonmaker said.

A $1 billion investment would give Ackman a 3.2 percent stake in FedEx based on its market value of $31.32 billion as of July 8.

Ackman has been investing in transport companies and fought a bitter proxy battle last year to overhaul Canadian Pacific, Canada’s No. 2 railway.

FedEx shares were up 7 percent, to $105.94, in heavy afternoon trading on the New York Stock Exchange. UPS shares were up 3 percent.

Option volume on FedEx was running eight times the daily average, with 60,000 calls and 21,000 puts crossing the tape during the first half of Tuesday’s trading session, according to options analytics firm Trade Alert.”

The logistics company are dedicated to delivering the best possible logistics service and are currently second in the world for parcel delivery. They offer international next day delivery to both business and private customers for all of their delivery needs.

To contact FedEx and discuss your personal logistics options, follow this link The number will connect you straight through to the customer services department and allow you to get your enquiry dealt with quickly and efficiently.

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