Apple Inc. (AAPL): Looking for Improvements at FedEx Corporation (FDX)

Looking forward, demand may pick up in the second quarter due to the launch of new electronics products that FedEx will ship from Asia to the U.S. and other markets. For instance, FedEx handles express shipments for Apple Inc. (NASDAQ:AAPL)‘s iPhone, according to Bloomberg. Apple Inc. (NASDAQ:AAPL) charters FedEx Boeing 777s — which can carry approximately 450,000 iPhones — for direct flights from China to the FedEx hub in Memphis.

Since Apple Inc. (NASDAQ:AAPL) could easily sell 20 million or more iPhones in the U.S. between now and the end of the calendar year, this represents a significant revenue opportunity. Therefore, investors should pay close attention to FedEx’s outlook and commentary on the business environment, as well as first-quarter results.

FedEx Corporation (NYSE:FDX) currently trades for about 16 times fiscal year 2014 earnings estimates. If the company’s profit improvement plan seems to be on track, that could be a great bargain. FedEx executives expect the bulk of the company’s cost savings to hit the bottom line next year, which should lead to strong profit growth, especially if global economic growth picks up.

The article Looking for Improvements at FedEx originally appeared on Fool.com and is written by Adam Levine-Weinberg.

Fool contributor Adam Levine-Weinberg owns shares of Apple and is long January 2015 $390 calls on Apple and long January 2015 $100 calls on FedEx. The Motley Fool recommends FedEx. It recommends and owns shares of Apple.

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