Call Traders Circle Shipping Giant Despite Mediocre Performance

FDX’s valuation is decent, but its stock fundamentals are lacking

Nov 11, 2021 at 3:38 PM

FedEx Corporation (NYSE:FDX) is an American conglomerate that provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce, and business services. FDX serves more than 220 countries and territories, offering products and services around the globe. At last glance, FDX was trading up 1.1% at $251.31.

FedEx stock has decreased 6% year-over-year and has shed 21% since peaking at an all-time high of $319.90 near the end of May. Moreover, shares of FDX just below the year-to-date breakeven level and the equity has tacked on 16% from its 52-week low of $216.34 tapped in early October. Additionally, FedEx Corporation offers a forward dividend of $3.00 with a dividend yield of 1.21%.

From a fundamental point of view, FedEx stock offers very little stability despite being valued at a market capitalization of $66 billion. In addition, FedEx Corporation has $36 billion in total debt and just $6.85 billion in cash on their balance sheet.

FedEx stock also has a decent valuation with a price-earnings ratio of 13.19, making it a potential recovery play after its bearish run this past year. FedEx stock also has a forward price-earnings ratio of 11.93, indicating an expected increase in earnings for the company.

Meanwhile, call traders have been circling the shipping stock. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the security's 50-day call/put volume ratio of 2.63 sits higher than all other readings from the past 12 months. This means long calls have been getting picked up at much faster-than-usual pace in the last two months.

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