Rizal Philippines
December 22, 2019
Just 2 days before Christmas. Merry Christmas every one
From Bloomberg - Amazon ends ground delivery by Fed ex
Amazon recently announced that it was halting ground deliveries via Fed Ex, in retaliation to announcement that it was evaluating agreements with Amazon. Will this affect the long term value of Fed Ex. Fed Ex says no Because Amazon business is just 1.3% of its total revenues. Some say it will because Amazon, having its Prime Delivery system which delivers more on time and has more systems in place will undercut Fed Ex in many markets. Faced with the reduction in world wide revenues due to tariff wars with China, Fed ex sees reduction in revenues and stock market prices.
Stock market prices of Fed Ex fell 1.6%; Amazon 1.1%
Amazon has been leasing jets for next day delivery. and has sorting centers near the airport and employed last mile truck owners contractors. In a recent survey Amazon topped the on time delivery at 94% with Fed ex at 4th place at 90%
Its either Fed Ex or Amazon announcing that Fed Ex will stick to Walmart and other companies which are on e commerce platform.
From Seattle Times - Fed Ex Net Income falls 40% due to severance with Amazon, shorter holiday period, and higher cost. Its profit for same period for same period was $935 million now down to only $650 million
Analysts sees a weakened and less valuable company in the next five years, which will precipitate a take over. And Amazon will prevail... Because Amazon has its own internal source of Revenues; Fed Ex has none. Will Walmart take over Fed Ex to adopt the business model of Amazon.
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