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Union Pacific Outperforming North American Rail Traffic Trends But Facing Inefficiencies and Inflation Hurdles

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Image Source: Chuckcars By Brian Nelson, CFA On November 30, the Association of American Railroads reported that North American rail traffic is down 1.9% on a year-to-date basis through November 26. Carloads of chemicals, coal, motor vehicles and parts, nonmetallic minerals, and petroleum products were strong, but weakness in farm products, forest products, grain, and metallic ores and metals weighed on overall strength. Rail remains among the most economical way to ship goods over long distances. The railroads were front and center in the news recently about a potential work stoppage over the issue of paid sick leave. President Joe Biden, however, was able to put an end to the potential for a strike by signing “into law a joint … Read more

FedEx Beats Estimates, Raises Guidance

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Image Source: FedEx Corporation – Second Quarter of Fiscal 2022 Earnings Infographic By Callum Turcan On December 16, the logistics giant FedEx Corporation (FDX) reported second quarter earnings for fiscal 2022 (period ended November 30, 2021) that beat both consensus top- and bottom-line estimates. The firm also moderately raised its earnings guidance for fiscal 2022 in conjunction with its earnings update after previously reducing its full fiscal year guidance when reporting its fiscal first quarter earnings update. FedEx noted in its fiscal second quarter earnings press release that “higher revenue per shipment at all transportation segments” positively benefited its operating income performance and helped offset headwinds from labor shortages and related supply chain constraints. The company also recently announced a … Read more

SEC Approves Financial Weapon of Mass Destruction and More Earnings Reports

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Let’s talk about quadruple-leveraged ETFs, Apple’s and Altria’s earnings reports, Coach’s fundamental improvement, Gilead’s fall from grace, IBM’s ongoing deterioration and more. By Brian Nelson, CFA Well, it is what it is as they say. In our ETF research and analysis, we consistently warn readers about the long-term price erosion dynamics of ultra-leveraged ETFs (of the double and triple variety), vehicles that we have emphasized are for “day traders,” not long-term investors. Believe it or not, however — we received news May 3 that the SEC approved a request to now list quadruple-leveraged ETFs, what we describe to be “financial weapons of mass destruction.” Yikes. You read that correctly–quadruple-leveraged exchange traded funds, ones that mimic the movement of the index … Read more