FedEx Initiates $1B Accelerated Share Repurchase Agreement With Mizuho
Portfolio Pulse from Shivani Kumaresan
FedEx Corp has initiated a $1 billion accelerated share repurchase (ASR) agreement with Mizuho Markets Americas LLC. This repurchase is part of FedEx's existing share repurchase program. FedEx will receive an initial delivery of approximately 3.2 million shares and the final number of shares will be determined by the volume-weighted average price of FedEx's stock, less a discount. FedEx reported Q2 FY24 revenue of $22.2 billion, missing estimates, and anticipates a low-single-digit percentage decline in full-year 2024 revenue. The company's cash and equivalents stood at $6.7 billion as of November 30, 2023. FedEx shares saw a 1.75% increase to $252.36 in recent trading.
December 26, 2023 | 4:23 pm
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FedEx Corp has begun a $1 billion ASR agreement with Mizuho, received an initial delivery of 3.2 million shares, and reported lower than expected Q2 FY24 revenue with a projected revenue decline for FY24.
The initiation of the ASR is a positive signal to investors, indicating that FedEx is confident in its stock value, which typically supports a short-term increase in stock price. However, the reported revenue miss and projected decline may temper investor enthusiasm, but the immediate positive price action suggests a net positive short-term impact.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100