Morgan Stanley Highlight's Potential Catalysts For FedEx Corporation Earnings

Morgan Stanley freight analyst William Greene previewed FedEx Corporation (NYSE: FDX) earnings on Friday. FedEx is set to release first quarter 2015 results September 17.

Greene discussed whether or not an earnings beat was already priced into the stock.

Analysts feel at a minimum, earnings should come in at consensus. Green offered four reasons why earnings may beat estimates:

• Beginning in 2014 Airfreight demand trends have increased internationally.
• FedEx has improved annual run-rate cost savings.
• In the previous may quarter, LTL (less-than-truckload) tonnage offered a big upside surprise.
• In most of the previous fiscal year fuel surcharges were negative; for first quarter 2015 analysts expect fuel surcharges to be about $0.20 positive.

Greene pointed out that historically, FedEx has traded at a premium P/E relative to the S&P 500. Currently, FedEx is trading trading inline with the 10-year average P/E; potentially offering upside with an earnings beat.

Shares of FedEx traded recently at $153.88, up 0.89 percent.