Analysts’ Top Services Picks: FedEx (FDX), Ctripcom (CTRP)


There’s a lot to be optimistic about in the Services sector as 2 analysts just weighed in on FedEx (NYSE:FDX) and Ctripcom (NASDAQ:CTRP) with bullish sentiments.

FedEx (FDX)

In a report released yesterday, Scott Schneeberger from Oppenheimer reiterated a Buy rating on FedEx, with a price target of $288. The company’s shares closed yesterday at $243.70.

Schneeberger wrote:

“We recently attended meetings with investors, and a primary takeaway was FedEx’s favorable view of business conditions across its Express/Ground/Freight segments as it’s targeting ~9% total revenue growth in FY19. FedEx’s FY19 operating margin expansion objective is +70bps y/y, primarily in FedEx Express, driven by a strong demand environment/TNT synergies/recovery following the FY18 TNT cyberattack. We anticipate gradual adjusted operating margin expansion in FedEx Ground starting in F2H19 via strong economic conditions, e-commerce activity, revenue quality focus, and efficiencies post incremental F1H19 network/hub expansion opex occurring ahead of the peak holiday season. FedEx Freight should build on its recent volume/ yield/margin momentum. We view solid potential for overall business momentum to perpetuate in FY19.”

According to TipRanks.com, Schneeberger is a 5-star analyst with an average return of 12.3% and a 70.4% success rate. Schneeberger covers the Services sector, focusing on stocks such as Service Corp International, Landstar System Inc, and General Finance.

The word on The Street in general, suggests a Strong Buy analyst consensus rating for FedEx with a $289.14 average price target.

See today’s analyst top recommended stocks >>

Ctripcom (CTRP)

In a report released yesterday, Jed Kelly from Oppenheimer maintained a Buy rating on Ctripcom, with a price target of $50. The company’s shares closed yesterday at $39.61, close to its 52-week low of $39.34.

Kelly wrote:

“CTRP shares are down 23% in the last 60 days, roughly in line with the Chinese Internet index (-25%), on geopolitical concerns and management tempering short- term top-line expectations from a more traveler-friendly policy initiative. We are reducing our estimates, while adjusting our PT to $50 from $54, and now expecting net revenue at the lower end of publicly stated guidance. We see shares range-bound unless commentary is more bullish for meaningful 4Q acceleration, unlikely in our view, based on VAS cross-selling headwinds limiting visibility. Despite some near- term choppiness, we view the recent revenue slowdown as somewhat self-inflicted, and would remain LT buyers on weakness based on CTRP’s larger customer service scale, leading travel supply, and better booking solutions driving larger market share gains in a tighter regulatory environment.”

Kelly has an average return of 3.6% when recommending Ctripcom.

According to TipRanks.com, Kelly is ranked #1139 out of 4847 analysts.

The word on The Street in general, suggests a Strong Buy analyst consensus rating for Ctripcom with a $51 average price target.

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