Greener BeeGreen HolidaysFedEx Reports Earnings Planning For The Holidays, Here’s How To Trade The Stock

Photographer: Christopher Dilts/Bloomberg

FedEx (FDX) reports earnings after the closing bell this afternoon. The stock is up 15.5% year-to-date and set its post-election all-time intraday high of $219.99 on July 10. The stock is in bull market, territory 21.9% above its post-election low of $176.44 set on Nov. 9.

Analysts expect the package delivery giant to earn $3.17 a share. The stock is relatively expensive due to its P/E ratio of 19.4. FedEx offers a puny dividend of 0.93%.

Here’s how to trade the stock based upon its weekly chart and key technical levels.

The Weekly Chart for FedEx

Courtesy of MetaStock Xenith

Courtesy of MetaStock Xenith

The weekly chart for FedEx ($215.08 on Sept. 18) is positive with the stock above its five-week modified moving average (in red) at $211.64. The stock is well above its 200-week simple moving average or “reversion to the mean” (in green) at $166.40, last tested during the week of Feb. 26, 2016, when the average was $132.12.

The “reversion to the mean” is an investment theory that the price of a stock will eventually return to a longer-term simple moving average, and the 200-week is simple to track. A stock trading above its reversion to the mean will eventually decline back to it on weakness. Similarly, a ticker trading below its reversion to the mean will eventually rebound to it on strength.

Article source: https://www.forbes.com/sites/investor/2017/09/19/fedex-reports-earnings-planning-for-the-holidays-heres-how-to-trade-the-stock/


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